2023 PUBLICATION

DIVIDEND POLICY AND MARKET VALUE OF FIRMS IN THE NIGERIAN CEMENT INDUSTRY

Abstract

This study assesses the impact of dividend policy on the market value of quoted cement industries, and the study is limited to the quoted cement industries in the Nigerian building material industry. The population of this study comprises of Ten (10) registered and licensed Cement Manufacturing Industries in Nigeria. The sample size used for this study comprises of four (4) cement manufacturing industries in Nigeria. Simple random sampling technique was used for this current study through a Descriptive survey method and the result was tabulated using frequency tables and percentage. The study has two (2) sets of variables which are the dependent and Independent variables. The independent variable of this study is dividend policy and the dependent variable is the market value of shares which can be measured by using Share Price (SP) of the selected sample companies.  The findings of this study discovered that there is a fair negative relationship between Share Price (SP) and Dividend Payout Ratio, this indicated that the share price of the company and the Dividend Payout Ratio of the company flow in different direction. While the association between Dividend Yield and Share Price shows a weak negative relationship in an adverse relationship. This adverse relationship specifies that the share price of the company and the Dividend Yield of the company flow in the opposite direction. It also adverse relationship between Share price and Earning per share. The findings also revealed that there is no significant relationship (impact) between the dependent variable (SP) and the independent variables (EPS, DY and DPOR). Therefore, it is recommended that the existing owners in the Nigerian Cement Industry should ensure all-embracing and critical evaluation of Cement Industry  Dividend Payout Ratio, Dividend Yield and Earning Per Share can significantly influence their  Share Price (SP), thereby making a great impact in influencing the investment decisions for the  potential investors whereas the Government should critically make sure that the Cement Industry Earning Per Share should be incorporated with the Share Price (SP) which might influence potential investors. 

Keywords: Dividend Policy, Share Price, Earning per Share, Dividend Yield, Dividend Payout Ratio.

Authors:

Sagir Lawal (PhD.) 

Mustapha Abdullahi