The Relationship between Cash Dividend Changes and Future Earning Changes
The purpose of this study is to investigate the relationship between changes in cash dividend payout policy and future earnings changes for listed firms on the Stock exchange of Thailand during 2000 to 2018. Employing the Fixed effect unbalanced panel least square and Pooled OLS for estimation, the results were showed a negative relationship between dividend changes and future earning changes. Specifically, the decreases of cash dividends will be followed by the increases of future earning changes in the subsequent 1, 2, and 3 years, but increases of cash dividends are negatively related to future earnings changes only 1 following year with statistic significantly. The finding conforms to the theory of Dividend signaling and the maturity hypothesis.