Total Equity Payout and Asset Return Predictability

Total Equity Payout and Asset Return Predictability

• Lanh Nguyen, Stuart Management Science Ph.D. student

Abstract:

Past studies use dividend yield as the main predictor for expected returns with mixed evidence. However, public firms have been using stock repurchase as the alternative to return values to shareholders. We investigate panel data of total equity payout, combining both dividend payout and stock repurchase, as a predictor for expected returns. We construct our database of returns and payouts to create firm-level total equity payout data without relying on approximations from annual financial statements. This study adds to understanding of total equity payout and stock returns by analyzing a finer granularity than an annum time-series of stock returns.

 

All Illinois Tech faculty, students, and staff are invited to attend.

The Friday Research Presentations series showcases ongoing academic research projects conducted by Stuart School of Business faculty and students, as well as guest presentations by Illinois Tech colleagues, business professionals, and faculty from other leading business schools.

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