Earnings Drive Dividend Decisions for Istanbul Stock Exchange Firms
The article looks at how companies in Istanbul decide on paying dividends to their shareholders. Managers from 38 non-financial firms were surveyed. The results show that companies mostly base their dividend decisions on their earnings. They aim to give a portion of their earnings to shareholders. Dividend yield is a common way companies decide how much to pay out. Unlike in the U.S., companies in Istanbul don't see share repurchases as a good alternative to dividends. The study supports the idea that companies pay dividends to attract investors and show they are doing well financially.