Internal Drivers of Dividend Payout in Nigerian Quoted Manufacturing Companies

This study evaluated the internal drivers of dividend payout in Nigerian quoted manufacturing firms over the period of 2011 to 2019. The study employed secondary data gotten from annual financial reports of selected manufacturing firms and the Nigerian Stock Exchange Fact book. Dividend pay-out ratio served as the dependent variable whereas present net earnings per share, cost of floating new shares, financial leverage and liquidity served as the independent variables. The study employed the stationarity test which revealed the stationarity of the data at first difference. More so, panel regression using fixed effects model was employed as the Hausman test confirms it is more appropriate than the random effects model. The findings of the study evince that present net earnings per share, debt/equity ratio (leverage), flotation costs and liquidity showed significant influence on the dividend payout of the selected manufacturing firms in Nigeria. From the results of this study, we conclude that present net earnings per share, debt/equity ratio (leverage), flotation costs and liquidity are significant internal drivers of dividend payouts of quoted manufacturing firms in Nigeria. Therefore, the study recommends among others that manufacturing firms should ensure healthy, consistent and growing earnings so as to guarantee a stable and healthy profit margin. Manageable debt to equity ratio should be maintained to ensure financial flexibility as high debt levels can limit a company's ability to pay dividends.