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Title IMPACT OF CASH FLOW, DIVIDEND PAYOUT AND INVESTMENT OPPORTUNITIES ON INVESTMENT UNDER FINANCIAL DISTRESS: EVIDENCE FROM NON-FINANCIAL SECTOR OF PAKISTAN STOCK EXCHANGE

Author(s) Hafiz Muhammad Zaid

Abstract Thesis Title: Impact of Cash Flow, Dividend Payout and Investment Opportunities on Investment under Financial Distress; Evidence from Non-Financial Sector of Pakistan Stock Exchange The purpose of study was to check the Impact of Cash Flow, Dividend Payout and Investment Opportunities on Investment under Financial Distress. The dependent variable in the study was investment and independent variables are cash flow, dividend payout and investment opportunities. Three control variables used in this study were Leverage, Return on assets and Financial expenses. The type of this study was empirical, with random sampling technique was used and all non-financial firms listed on Pakistan Stock Exchange are under the umbrella of population from 2007 to 2016. Data was gathered from different sources, as from Balance Sheet Analysis of SBP and financial statements provided on the websites of the firms. In methodology, correlation and panel data regression was used for data analysis. To check the normality unit root test was used in this study for each variable. Two different regression models were used in this study. First regression model run only on the dependent variable and independent variables (excluding control variables) under financial distress and random effect model was used for this purpose. Second regression model was run on the dependent variable and independent variables (including control variables) under financial distress and fixed effect model was used for this purpose. According to the results, the relationship between cash flow and investment was positive and significant under financial distress. The relationship between dividend payout and investment was positive and insignificant under financial distress. The relationship between investment opportunities and investment was negative and significant under financial distress. On the other hand, control variables sales growth showed positive and significant relationship and efficiency also showed positive and significant relationship with investment under financial distress. v Keywords: Cash flow, dividend payout, Investment opportunities, investment and financial distress.

Type Thesis/Dissertation MS

Faculty Management Sciences

Department Management Sciences

Language English

Publication Date 2018-11-13

Subject Finance

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