Dividend Policy, Liquidity and Firm Value of Consumer Goods Industry Companies in Nigeria

The focus of this study is to determine the effect of dividend policy and liquidity on firm value. The research was conducted on companies in the consumer goods industry sector on the Nigeria Exchange Group for the 2012-2021 period. The population used in conducting this study was obtained from the consumer goods industrial sector companies listed on the bourse of the Nigeria Exchange Group (NGX Group) which have a total of 25 companies. Purposive sampling technique was used and 17 companies were selected that met the condition of regular dividend payment. Panel least regression data analysis technique was used for the study. Secondary data used were obtained from audited financial statements of the sampled companies for the period and Nigerian Exchange Group factbook. The results showed that dividend policy, liquidity and market risk had positive significant relationship with firm value at 5.8198:0.000; 15:6395:0.000 and 1.2805:0.000 respectively indicating 1% significance level. Free cashflow had positive insignificant relationship with firm value while ownership concentration has negative but insignificant causal effect on firm value. R², the coefficient of determination of 0.8329 reflects that the model explanatory variables account for 83.29% of value of price to book value, the explained variable. It is recommended that adequate level of profitability should be a priority to enable payment of dividend. Liquidity position should be at the acceptable levels and market risk should not exceed tolerance limit

Effect of Dividend Policy on Share Price Movement of Selected Quoted Companies in Nigeria

Dividend Policy remains a contentious area of corporate finance with a school of thoughtindifferent and another in support. The two contending views under which other hypotheseswere premised are; on the popular dividend relevance and irrelevance theories. Dividendpolicy scholars argued that it expresses information content about future prospects andcashflow of the firm. Irrelevance proponents hinged their argument on the point that all that isnecessary is the investment policies and risk of an enterprise in maximizing shareholderswealth. The latter proponents advanced their theories in favour on capital and future gainsinpreference to immediate payment of cash in form of dividend. This study centered oneffectsof dividend policy on share price of selected quoted companies in Nigeria with dividendper-share, earnings per-share and profitability taken as endogenous variables. Thirteenquotedcompanies on the floor of the Nigeria Exchange (NGX Group) using randomsamplingwereused. Pooled OLS regression with fixed and random effects models were employedforestimation. The fixed effects model was preferred as the efficient estimator for the studyandthe results revealed that dividend per share has inverse and statistically insignificant effectswith share price, likewise; earnings per share. Profitability has positive but insignificanteffect on share price