The Relationship between Earning, Dividend, Stock Price and Stock Return: Evidence from Iranian Companies

International Conference on Humanities, Society and Culture, IPEDR Vol.20 (2011)

6 Pages Posted: 4 Mar 2013

See all articles by Mohammad Ebrahimi

Mohammad Ebrahimi

Islamic Azad University (IAU)

Arezoo Aghaei Chadegani

Islamic Azad University; University Kebangsaan Malaysia

Date Written: March 2, 2011

Abstract

The purpose of this paper is to investigate whether the current period earning divided by stock price at the beginning of the stock market period, current period dividend divided by stock price at the beginning of the stock market period, prior dividend divided by stock price at the beginning of the stock market period and the reverse of stock price at the beginning of the stock market period are relevant to explain stock market returns in Iran. We used cross-section, pooled data and panel data regression models for testing the effects of the above variables on stock returns. The results show that in some years, shareholders pay special attention to dividends and also the variable prior dividend divided by stock price at the beginning of the stock market period affects stock return. Moreover, there is a significant relationship between current period earning divided by stock price at the beginning of the stock market period and stock return. Thus, results theoretically support the existence of relationship between earning, dividend and stock return.

Keywords: earning, stock return, Tehran Stock Exchange, stock price, earning per share

Suggested Citation

Ebrahimi, Mohammad and Aghaei Chadegani, Arezoo and Aghaei Chadegani, Arezoo, The Relationship between Earning, Dividend, Stock Price and Stock Return: Evidence from Iranian Companies (March 2, 2011). International Conference on Humanities, Society and Culture, IPEDR Vol.20 (2011), Available at SSRN: https://ssrn.com/abstract=2227363

Mohammad Ebrahimi

Islamic Azad University (IAU)

Hamedan, Iran
Iran
Tehran, Isfahan 461-15655
Iran

Arezoo Aghaei Chadegani (Contact Author)

Islamic Azad University ( email )

Tehran
Iran

University Kebangsaan Malaysia ( email )

Malaysia

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