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Investors' Payout-form Preference and Taxes
Chazi, Abdelaziz Theodossioub, Alexandra Zantout, Zaher
Chazi, Abdelaziz
Theodossioub, Alexandra
Zantout, Zaher
Date
2013-06-05
Advisor
Type
Working Paper
Degree
Citations
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Description
Abstract
We find the form of U.S. corporate cash payout to shareholders often relevant to share price and in different directions at different times. Regularly cash-dividend paying firms have a significant share price premium compared to regularly stock-repurchasing firms in the early 1970s, but this premium exhibits a significant general negative trend and turns into a discount in the mid-to-late 2000s. Also, the premium (discount) is significantly related to the time-series changes in the differential tax burden on dividends and long-term capital gains. It is not related to the excess market return.