Authors: Sulaeman Rahman Nidar; Muhammad Maraya
Addresses: Department of Management and Business, Faculty of Economics and Business, Padjadjaran University, Bandung, Indonesia ' Department of Management and Business, Faculty of Economics and Business, Padjadjaran University, Bandung, Indonesia
Abstract: The purpose of this study is to determine the return of the reaction of the announcement of stock dividend. This study uses event study approach, where the observation of the abnormal return during the event period, which is seven days prior to the announcement of up to seven days after the announcement. The method used is quantitative method. Hypothesis testing is used to see the significance of abnormal return values occurring in the event by comparing t-arithmetic with t-table and test independent sample of t-test to determine differences in the value of abnormal return of some subsample. The results of this study indicate that: 1) no positive abnormal return significantly to the announcement of stock dividend around the event period; 2) no average abnormal return is greater in companies issuing initial stock dividend compared to companies that issue stock dividend subsequent; 3) no average abnormal return is greater in companies with issuing high stock dividend ratio compared to the company that issued the low stock dividend ratio.
Keywords: stock dividend; initial stock dividend; stock dividend subsequent; high stock dividend; low stock dividend; abnormal return.
International Journal of Governance and Financial Intermediation, 2021 Vol.1 No.2, pp.120 - 126
Received: 02 Sep 2017
Accepted: 01 May 2018
Published online: 04 Aug 2021 *