An Empirical Research About Signaling Hypothesis Of Dual Dividend Policy

Managers of listed companies transmit company good development signals to the outside world by making a reasonable dividend policy, and attract existing and potential investors to invest, further access to low-cost source of funds. A well-run enterprises should provide information for investors through a certain way to realize the value of the enterprise, at the same time, investors can also formulate a reasonable investment way through the analysis of dividend policy, so the dividend policy is of great practical significance. Many scholars agree that declared dividend policy is a kind of information transmission mode which can be passed to the outside shareholders company operators earnings expectations for the future and prospects for development.Researches for dual dividend signaling theory are less.Dual dividend signal effect is not just the sum of the cash dividend and stock dividend signal effect, when the listed company issure cash dividend and stock dividend at the same time, the signal of dual dividend policy is worth to study,,to provide investors and listed companies the investment decision reference.In this paper, combining literature review with the Chinese market reality, writer research the of dual dividend signaling theory by empirical study. then establish the dual dividend policy and the company’s future profit growth model, through the query method such as annual reports of listed companies to obtain experimental data, using principal component analysis method to extract the characteristic variables, on this basis, using the method of multiple linear regression method to study and verify the validity of the model. This study the examine whether dual dividend distribution contains the effective information of stock price changes and the change of corporate profitability, the empirical results show that distribution of dual dividend announcement effect of the market and the correlation between dual dividend and future profitability, and provide advice to the listed company’s dividend decision and investors use dividend policy to determine the investment decisions in China’s securities market.