股利政策外文翻译（已处理）.doc

股利政策外文翻译 Dividend policy Profitable companies regularly face three important questions: 1 How much of its free cash flow should it pass on to shareholders? 2 Should it provide this cash to shareholders by raising the dividend or by repurchasing stock? 3 Should it maintain a stable, consistent payment policy, or should it let the payments vary as conditions change? When deciding how much cash to distribute to shareholders, finance manager must keep in mind that the firm’s objective is to imize shareholder value. Consequently, the target pay rate ratio?define as the percentage of net income to be paid out as cash dividends?should be based in large part on investors’ preference for dividends versus capital gains: do investors prefer 1 to have the firm distribute income as cash dividends or 2 to have it either repurchase stock or else plow the earnings back into the business, both of which should result in capital gains? This preference can be considered in terms of the constant growth stock valuation model: If the company increases the payout ration, the raises.This increase in the numerator, taken alone, would cause the stock price to rise. However, ifis raised, then less money will be available for reinvestment, that will cause the expected growth rate to decline, and that will tend to lower the stock’s price. Thus, any change in payout policy will have two opposing effects. Therefore, the firm’s optimal dividend policy must strike a balance between current dividends and future growth so to imize the stock price. In this section, we examine three theories of investor preference: 1the dividend irrelevance theory, 2the bird-in-the-hand theory ,and3 the tax preference theory DIVIDEND IRRELEVANCE THEORY It has been argued that dividend policy has no effect on either the price of a firm’s stock or its cost of capital. If dividend policy has no significant effects, then it would be irrelevance .The principal proponents of dividend irrelevance theory are Mer