Title

Stock Price Reaction To Dividend Increases In The Hotel And Restaurant Sector

Keywords

Corporate finance; Dividend; Event study; Reaction; Valuation

Abstract

This study assesses the stock price reaction to announcements of dividend increases by firms in the hospitality industry using a standard event study methodology. Results indicate that dividend increases are favorably received by market participants because a statistically significant positive market reaction is observed. Results of a cross-sectional analysis show that the size of the market reaction across firms is positively related to the magnitude of the dividend increase. These results imply that managers ought to carefully consider the ramifications of a change in dividend policy because such changes appear to be perceived as signals of the firm's future financial condition. © 1999 Council on Hotel, Restaurant and Institutional Education.

Publication Date

12-1-1999

Publication Title

Journal of Hospitality and Tourism Research

Volume

23

Issue

1

Number of Pages

40-52

Document Type

Article

Personal Identifier

scopus

DOI Link

https://doi.org/10.1177/109634809902300104

Socpus ID

64049087451 (Scopus)

Source API URL

https://api.elsevier.com/content/abstract/scopus_id/64049087451

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