TITLE:
Conventional Determinants of Corporate Payout Policies in the Egyptian Stock Market
AUTHORS:
Abdel-Gawad Heba, Sakr Ahmed, Abdou Rabab
KEYWORDS:
Dividend Policy, Dividend Decision, Dividend Payout Ratio, Egypt
JOURNAL NAME:
American Journal of Industrial and Business Management,
Vol.11 No.11,
November
30,
2021
ABSTRACT: Corporate Payout policy is one of the interesting topics in corporate
finance literature that attracted the attention of many researchers. Despite
the extensive research in this area, there is a contradiction between
researchers on what are the main determinants of corporate payout policy.
Researchers have mainly focused on developed markets and looked at a
single dimension of the dividend policy. Therefore, the current study explores
the determinants of dividend payout ratio by analyzing the effect of
profitability, free cash flow, investment opportunity, liquidity, leverage,
firm size and ownership structure on two dimensions of the dividend payout
policy: the dividend decision and the payout ratio, taking a sample of all
Egyptian listed firms in the period from 2007 till 2020. The results reveal the
significance of profitability and investment opportunity on the dividend
decision. For the payout ratio model, it is found that free cash flow,
profitability and managerial ownership are significant determinants of payout
ratio. Finally, by analyzing the dividend-paying firms, the results reveal that
financial leverage affects the payout ratio of these firms.