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Perfect market view (of dividend policy) |
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Perfect market view (of dividend policy)Analysis of a decision on dividend policy, in a perfect capital market environment, that shows the irrelevance of dividend policy.Perfect market view (of dividend policy) Similar MatchesSpecial dividendSpecial dividendAlso referred to as an extra dividend. Dividend that is unlikely to be repeated. Dividend coverDividend coverThe ratio between a company's earnings (net profit after tax) and the net dividend paid to shareholders, calculated as earnings per share divided by the dividend per share.So if a company has earnings per share of 8p and it pays out a dividend of 2.1p, the dividend cover is 8 / 2.1 = 3.80Generally speaking, a ratio of 2 or higher is considered safe (in the sense that the company can well afford the dividend), but anything below 1.5 is risky. If the ratio is under 1, the company is using its retained earnings from a previous year to pay this year's dividend. Tax differential view (of dividend policy)Tax differential view (of dividend policy)The view that shareholders prefer capital gains over dividends, and hence low payout ratios, because capital gains are effectively taxed at lower rates than dividends. Interim dividendInterim dividendThe declaration and payment of a dividend prior to annual earnings determination. Unpaid dividendUnpaid dividendA dividend which has been declared by a corporation but has not yet been paid. Further SuggestionsIndicated dividendextra dividend Dividend trade roll or play interim dividend Dividend scrip dividend Dividends payable Dividend clientele Dividend policy dividend growth year end dividend Dividend requirement Expected dividend yield Accumulated dividend Residual dividend approach Dividend rollover plan Omitted dividend With dividend accumulated dividend dividend yield Dividend in arrears Year end dividend Unpaid dividend Dividend Order Stock dividend |
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