JEL Classification System
G32, M40, M41
Abstract
Various studies on the relationship between financial leverage and dividend payout have been conducted; however, different factors affecting this relationship remain unexplored. This study aimed to identify the effect of different firm-specific moderating variables on the relationship between financial leverage and dividend payout of Philippine publicly-listed companies under the property sector for the years 2012–2016. These firm-specific variables were classified into two categories—company profile and financial condition. By employing multiple regression with the interaction model, the results of this study found that business risk has a significant effect on the relationship between financial leverage and dividend payout. Similarly, firm size was determined to be significant to the relationship due to the growing importance of stakeholder relationships to larger and more influential companies. In addition, a significant effect on the relationship between financial leverage and dividend payout was determined from liquidity, tangibility, and non-debt tax shield. Thus, this study recommends that potential shareholders who aim to maximize their wealth through dividends invest in corporations with high levels of liquidity and tangibility, and with minimal amounts of non-debt tax shields.
Recommended Citation
Cudia, Cynthia P.; Chun, Harrison Kendrick L.; Papa, Tristan Dranel M.; Tahilramani, Raveena S.; and Tan, Althea R.
(2020)
"Effect of Moderating Variables: Financial Leverage and Dividend Payout of Publicly-Listed Property Sector of the Philippines,"
DLSU Business & Economics Review: Vol. 29:
No.
2, Article 6.
DOI: https://doi.org/10.59588/2243-786X.1132
Available at:
https://animorepository.dlsu.edu.ph/ber/vol29/iss2/6
Included in
Accounting Commons, Economics Commons, Finance and Financial Management Commons, Marketing Commons
