Surprise ! Higher Dividends = Higher Earnings Growth

@inproceedings{Arnott2003SurpriseH,
  title={Surprise ! Higher Dividends = Higher Earnings Growth},
  author={Robert D. Arnott and Clifford S. Asness},
  year={2003}
}
We investigate whether dividend policy, as observed in the payout ratio of the U.S. equity market portfolio, forecasts future aggregate earnings growth. The historical evidence strongly suggests that expected future earnings growth is fastest when current payout ratios are high and slowest when payout ratios are low. This relationship is not subsumed by other factors, such as simple mean reversion in earnings. Our evidence thus contradicts the views of many who believe that substantial… CONTINUE READING
Highly Cited
This paper has 20 citations. REVIEW CITATIONS
16 Citations
48 References
Similar Papers

References

Publications referenced by this paper.
Showing 1-10 of 48 references

Stocks, Bonds, Bills and Inflation: 2000 Yearbook

  • Ibbotson Associates.
  • Chicago, IL: Ibbotson Associates.
  • 2001
Highly Influential
13 Excerpts

Dividend Changes and Future Profitability.

  • Nissim, Doron, Amir Ziv
  • Journal of Finance,
  • 2001

Investing without an Equity Risk Premium: A Brave New World?

  • Ambachtsheer, P Keith
  • Ambachtsheer Letter,
  • 2001

The Death of the Risk Premium: Consequences of the 1990s.

  • Arnott, D Robert, Ronald Ryan
  • Journal of Portfolio Management,
  • 2001

Bubble Logic or How to Learn to Stop Worrying and Love the Bull.

  • Asness, Clifford
  • Unpublished manuscript, AQR Capital Management…
  • 2000

Similar Papers

Loading similar papers…