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consequence with the shifting profits despite the stable
dividend-to-earnings ratio
2. A stable dollar dividend per share
This policy sets and maintains a stable dividend per share over
time as long as there is no permanent increase in earning power
and the ability to pay dividend. Management will not increase
the dollar dividend until they assure that the higher dividend
level can be maintained continuously.
3. A small, regular dividend plus a year -end extra
This policy defined company to pay a small, regular dollar
dividend plus a year-end-extra in the robust years. It admits that
dividends contain significant information. So, by distributing
extra dividend payment, investors will be interested to make
additional investments. As a result, stock prices will be
increased.
4. Fluctuating dividend and payout r atio
In this pattern of payment, dividend and payout ratio are
adjusted with the change in profit and the necessity of
company’s capital investment periodically.
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