The Study and Test Dividend Policy Based on Models Ohlson: Case Iran Market

Abstract

This study investigates the effects of dividend policy on market value. empirically the research data is collected from 65 firms in the Tehran Security Exchange (TSE) during 2005-2014.multiple regressions technique is used for examining the stated hypitheses. It is used for, three Ohlson equity valuation models. The first model is based on permanent earning and the second model is based on expected future earnings and, finally, the third model is based on current earnings.The relationship between earnings and dividends has content information for evaluation of the companies. In order to examine the hypotheses, data is collected from the annual reports of the companies using official bulletins of the Tehran stock exchange, mainly, through Novin software, Tadbir Pardaz software, and stock sites such as www.rdis.ir & www.irbourse.com. The results indicate that based on the models, debt, permanent income and, the net operating cash flows, debt and investment, , investments and debt are associated with stock prices, significantly and positively and all samples are selected,. It also confirms that the results of the comparison of three models, anatomical features and the ability of the models to predict the market value are more important than the other two models.This research provided a good chance to examine the effects of dividend policy on company's market value. Meanwhile, it took into consideration whether other control mechanisms such as firm’s size have any effects on this relationship. Keywords:dividend policy, the company's market value, equity valuation models Ohlson