Dividend changes and stock price informativeness

Amedeo De Cesari, Winifred Huang-Meier

Research output: Contribution to journalArticlepeer-review

35 Citations (SciVal)
101 Downloads (Pure)


We investigate how private information in stock prices impacts quarterly dividend changes. We find that the positive relationship between past returns and current dividend changes strengthens when returns convey more private information. This finding is robust to the use of several price informativeness measures and the inclusion of managerial private information and stock overvaluation measures. Managers seem to learn new information from stock prices that they use when deciding on their dividend policy. This study highlights private information in stock prices as an important determinant of dividend policy and contributes to the literature on the real effects of financial markets.
Original languageEnglish
Pages (from-to)1-17
Number of pages17
JournalJournal of Corporate Finance
Early online date20 Aug 2015
Publication statusPublished - Dec 2015

ASJC Scopus subject areas

  • Finance


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