Impact of Dividend- Per- Share on Common Stock Returns: A Case Study of Some Selected Manufacturing Firms Listed on the Nigerian Stock Exchange.

Abstract

This study investigated the impact of dividend –per -share on common stock returns of the Manufacturing firms listed on the Nigerian Stock Exchange. The data for the study was collected from ten companies randomly selected. The study period was from 1991-2003. The common stock returns for each of the 10 firms for the 13-years study period were calculated on weekly basis and annualized using geometric means. And, the actual dividend-per-share for each of the 13-years period was obtained from the various annual reports and accounts of the sampled firms. Multiple regressions were used to study the relationship between the dependent variable and the independent variable of this study. Pearson Moment Correlation was used for assessing the magnitude and the direction of the relationships between the variables of the study. The Pearson Correlation Coefficient  was found to be  0.735, which is highly significant because it is closer to 1 than it is to 0.The regression analysis of the data conducted in order to test the research hypothesis indicates that dividend-per-share has a significant impact on the common stock returns of the sampled firms  (P<0.01).

Keywords: dividend-per-share, common stock return,