The Effect Of Cash Dividends In Information Technology Industry On The Value Of Firms

Dividend is one of the important contents of corporate profit distribution.The essence of dividend policy is whether the company distributes its income or reinvests it.Dividend policy will affect the long-term development of the company.In domestic and foreign capital markets,cash dividends have become the most common form of dividend distribution.Enterprises hope to maximize their value through the distribution of cash dividends.In recent years,domestic and foreign scholars have conducted a lot of research on the issue of cash dividends affecting the value of the company.However,due to differences in market environment,theoretical perspectives,and research samples,there are differences in research conclusions.At the same time,China’s economic development has entered a new normal.The transformation and upgrading of economic structure needs the support of information technology,and the information technology industry is facing unprecedented development opportunities.In addition,the different levels of growth will also make the difference in the impact of cash dividends on the value of the company,but there is less research on this issue.Therefore,this paper first studies the impact of cash dividends in the information technology industry on the value of the firm,and then analyzes how this effect differs with growth.This is of positive significance to the information technology industry through the rational distribution of profits to maximize the value of the company,and better promote the economic development of China.This article reviews the literature and theories on growth,cash dividends,and corporate value.Then this paper analyzes the characteristics and the current status of cash dividend distribution of the information technology industry.Based on this,this paper analyzes the effect of cash dividend on the Value of the Firm in the information technology industry for different growth levels.This article takes the sample of listed companies in China’s information technology industry from 2012 to 2016 as a sample,constructs an index system for the growth evaluation of the information technology industry,then conducts corresponding empirical analysis.In empirical research,this paper mainly uses statistical methods such as factor analysis,descriptive statistical,correlation analysis and regression analysis.This paper mainly empirically examines the impact of the value from cash dividend enterprise in the information technology industry,and further studies the influence of cash dividends on the value of the enterprise under different growth conditions.The main conclusions are as follows:(1)Information technology industry listed companies’ cash dividend payment level is negatively related to corporate value.(2)The growth level will intensify the negative correlation between cash dividends and corporate value of listed companies in the information technology industry;compared with low-growth companies,the negative correlation between cash dividend payment levels and corporate value of high-growth companies is more obvious.Based on the above research conclusions,this article believes that information technology listed companies should distribute cash dividends base on it’s abilities,and reasonably formulate cash dividend policies based on the characteristics of the industry and the growth level of the company.The government regulators should further improve the cash dividend information disclosure mechanism and broaden the financing channels for information technology industry.It is suggested that investors in information technology industry should pay more attention to capital gains,and determine investment strategies based on the characteristics of the industry and the stage of the company’s development.