Dividend Policy and the Market Value of Stocks: Panel Data Evidence from Listed Companies on the Qatar Stock Exchange (2020–2025)

Abstract

Dividend policy has long been recognized as a key corporate financial decision because of its potential implications for stock valuation and investors’ wealth. However, empirical evidence on the relationship between dividend policy and the market value of stocks remains inconclusive, particularly in emerging capital markets. This study investigates the effect of dividend policy on the market value of stocks listed on the Qatar Stock Exchange using a balanced panel dataset of 15 listed companies covering the period 2020–2025. Panel data econometric techniques were employed to estimate the relationship after selecting the most appropriate model based on standard specification tests. The market value of stocks was proxied by the closing stock price, while dividend policy was represented by earnings per share, cash dividends per share, retained earnings, dividend payout ratio, bonus shares, and treasury shares. The empirical findings reveal that the fixed-effects model provides the best specification for the analysis. Furthermore, earnings per share and cash dividends per share have a positive and statistically significant effect on the market value of stocks, whereas retained earnings, dividend payout ratio, bonus shares, and treasury shares do not exert a statistically significant influence. These findings enrich the empirical literature on dividend policy by providing recent evidence from the Qatar Stock Exchange and suggest that profitability and cash dividend distributions are the principal determinants of stock market valuation in the sampled firms.