Research On The Economic Effect Of SN Company’s High Cash Dividend Policy

As a form of incentive and reward,a company’s dividend policy has always been of interest to the market and to investors.In addition to the distribution of earnings,dividend policy can also reflect aspects of business conditions.At the same time,dividend policy has a profound impact on both past operations and future development of a company.Since 2001,China has been issuing policies to guide and encourage listed companies to pay dividends,thus starting a wave of high dividend payouts in the securities market.However,there is a limit to the positive effect of high dividend payout policies.Once an enterprise fails to make decisions based on the current actual situation,high payout behaviour will lead to a large amount of capital outflow,affecting the normal operation of the enterprise,thus weakening the competitive advantage and damaging the interests of stakeholders.Therefore,the issue of how to regulate the high dividend payout policy to suit the development of the company is an urgent issue that needs to be addressed.Based on previous research experience,there is a lack of research on the high dividend payout policy of enterprises in cyclical industries.In this regard,this paper selects companies in the livestock industry,analyses the economic impact of their high dividend payout policies,explores the reasons for the negative economic impact,analyses the problems that exist,and analyses the reasons for each problem,in the hope of making appropriate recommendations for listed companies to implement high dividend payout policies in a reasonable and scientific manner.In this paper,two main research methods,namely thematic research and literature research,are used to study the selected companies.Firstly,the research background and significance of the study are explained,and the research ideas are formed by combing the domestic and international literature.Secondly,we analyse the economic impact of SN’s high cash dividend policy from three aspects: business performance analysis,market response analysis and enterprise value analysis,and find that the implementation of a high cash dividend policy will affect the company’s solvency,while having an impact on operating capacity,profitability and growth capacity.A high dividend payout policy can stimulate the share price in the short term,but in the long term,it will not yield excessive returns and the positive market response will not be sustainable.Based on the “one bird in hand “ theory and signaling theory,the reasons for the negative economic impact of SN’s high dividend payout policy were analysed and studied in depth.The four reasons for the policy are Finally,the study proposes recommendations to optimise the high payout dividend policy of SN companies,taking into account corporate development strategies,changes in industry cycles,diversification of dividend payments and adjustments to shareholding structures and governance mechanisms.This study has certain reference implications for listed companies to optimise their high dividend payout policies,rationalise their dividend payment mechanisms,and improve their shareholding structure and governance mechanisms.