Abstract
We report that whereas firms with high earnings distributions tend to have low-to-moderate growth (consistent with conventional theory), firms with low earnings distributions run the range between high and low performers. We interpret our findings for firm growth and payout policy in relation to the firm's location on the Boston Consulting Group (BCG) matrix that combines high/low growth with high/low market share. Our findings suggest that the market has difficulty in distinguishing between these types of firms. A concern is that investor preferences as an outcome may be focussed on dividend-paying firms at the expense of younger growing firms in need of retained earnings. Accounting and Finance
| Original language | English |
|---|---|
| Pages (from-to) | 2345-2376` |
| Number of pages | 32 |
| Journal | Accounting and Finance |
| Volume | 59 |
| Issue number | 4 |
| DOIs | |
| Publication status | Published - Dec 2019 |
Keywords
- BCG matrix
- Dividend payout
- Firm growth
- Firm life cycle
- P/E ratio
Cite this
}
The association between dividend payout and firm growth : Australian evidence. / Dempsey, Michael; Gunasekarage, Abeyratna; Truong, Thanh Tan.
In: Accounting and Finance, Vol. 59, No. 4, 12.2019, p. 2345-2376`.Research output: Contribution to journal › Article › Research › peer-review
TY - JOUR
T1 - The association between dividend payout and firm growth
T2 - Australian evidence
AU - Dempsey, Michael
AU - Gunasekarage, Abeyratna
AU - Truong, Thanh Tan
PY - 2019/12
Y1 - 2019/12
N2 - We report that whereas firms with high earnings distributions tend to have low-to-moderate growth (consistent with conventional theory), firms with low earnings distributions run the range between high and low performers. We interpret our findings for firm growth and payout policy in relation to the firm's location on the Boston Consulting Group (BCG) matrix that combines high/low growth with high/low market share. Our findings suggest that the market has difficulty in distinguishing between these types of firms. A concern is that investor preferences as an outcome may be focussed on dividend-paying firms at the expense of younger growing firms in need of retained earnings. Accounting and Finance
AB - We report that whereas firms with high earnings distributions tend to have low-to-moderate growth (consistent with conventional theory), firms with low earnings distributions run the range between high and low performers. We interpret our findings for firm growth and payout policy in relation to the firm's location on the Boston Consulting Group (BCG) matrix that combines high/low growth with high/low market share. Our findings suggest that the market has difficulty in distinguishing between these types of firms. A concern is that investor preferences as an outcome may be focussed on dividend-paying firms at the expense of younger growing firms in need of retained earnings. Accounting and Finance
KW - BCG matrix
KW - Dividend payout
KW - Firm growth
KW - Firm life cycle
KW - P/E ratio
UR - http://www.scopus.com/inward/record.url?scp=85045377152&partnerID=8YFLogxK
U2 - 10.1111/acfi.12361
DO - 10.1111/acfi.12361
M3 - Article
AN - SCOPUS:85045377152
VL - 59
SP - 2345-2376`
JO - Accounting and Finance
JF - Accounting and Finance
SN - 0810-5391
IS - 4
ER -