The informational content of the timing of dividend announcements

Avner Kalay*, Uri Loewenstein

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


This paper contains a test of a new aspect of the informational content of dividend; namely, is there information in the timing of the announcements? The empirical evidence indicates that the market expects 'bad news' to be delivered late and that these expectations are confirmed. Mean excess returns of stock prices around late announcements are, depending on the assumed returns generating process, either significantly negative or insignificant while significantly positive around the entire population of announcements. Moreover, the proportion and magnitude of dividend reductions associated with late announcements are significantly larger than in the complete universe of announcements.

Original languageEnglish
Pages (from-to)373-388
Number of pages16
JournalJournal of Financial Economics
Issue number3
StatePublished - Jul 1986


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