| For listed companies,whether issue dividends or not and the dividend policy on how to issue dividends delivers positive or negative information to the market,which is related to the fluctuation of stock price and causes market reaction.On the evening of April 25,2017,Gree electric appliances released its annual report,in which it announced no dividend distribution.However,according to Dong Mingzhu's talk in boao BBS on April 9,investors speculated that the dividend in 2017 should be no less than 6.3 RMB per share.The fact is quite different from the speculation,causing Gree electric appliances shares to fall by the limit.Gree electric appliances has implemented the dividend policy for 11 consecutive years.Then,why did Gree electric appliances with the characteristics of continuous dividend distribution not distribute dividends in the case of good profit and sufficient capital in 2017?Once the stability of dividend policy is interrupted,the stock premium will disappear and even the stock price will drop sharply.It has a great impact on the company's market value and the market will react violently.Therefore,this paper studies which factors influence the formulation of dividend policy of Gree electric appliances and the market reaction brought by dividend policy.Using Case Analysis Method and Event Research Method,this paper studies the influencing factors of dividend policy,market reaction and how to cause market reaction.At the same time,in order to avoid unexpected losses of enterprises and reduce investment risks of investors,Suggestions are made to enterprises,investors and listed companies.This paper takes Gree electric appliances dividend policy as a case study and Supor as the comparison company We briefly comb company's situation and its dividend policy,analyze the influence factors of dividend policy,including financial factors,national policy,executive overconfidence,industry cycle,etc.,use Event Study analyze the case enterprise market reaction,.Using data and the theory of dividend policy analyze how to cause the market reaction..This paper believes that the dividend policy of Gree electric appliances is affected by multiple factors,including strong profitability,larger asset size and non-overconfidence of senior executives,which contribute to the continuous high dividend distribution of Gree electric appliances.In line with the policy requirements,the company needs to transform due to the rapid macroeconomic growth and the top of the industry development.The company's funds for investment and financial management have affected the dividend distribution of Gree electric appliances in 2017.As for the market reaction brought by the dividend policy of Gree Electric Appliances,the study finds that the payment of cash dividend does not bring obvious short-term excess return rate,the stock dividend is more loved by the public,and once the stability of dividend is interrupted,it will certainly bring bad market reaction.The dividend policy of listed companies impacts the diversification of the company,the subsequent dividend policy and its market value.the investor behavior has a significant impact on the market value of the company.This paper makes an analysis of the factors influencing the dividend policy and the market response by studying on Gree Electric Appliances.In theory:how does the dividend policy cause the market reaction through the analysis of the theory,which enriches the practical application of the theory;In practical application:through the case study,we know the influence factors of dividend policy of companies,market reaction of dividend policy and how it influences.On the one hand,provide investment'basis,help investors realize the market value,identify premium,avoid blind investment,evade the investment risk;On the other hand,company managers can formulate dividend policies based on various factors,make correct and scientific decisions and make decisions conducive to the long-term development of the company. |
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