Open Access Article SciPap-753
An Empirical Analysis of Share Price Determinants in Nigeria: A Dividend and Net Asset Replica
by Edesiri Godsday Okoro 1,* and Edirin Jeroh 2

1 Department of Economics, Faculty of the Social Sciences, Nnamdi Azikiwe University, , Awka, Anambra State , Nigeria

2 Department of Economics, Faculty of the Social Sciences, Delta State University, P.M.B. 1, Abraka, Delta State , Nigeria

* Authors to whom correspondence should be addressed.

Abstract: In attempting to determine the factors that affect the prices of stocks generally in capital markets, two schools of thought exist. While a school of thought believes that accounting information are the major determinants of stock prices in capital markets, the other argues that the major determinants of stock prices are non-accounting information. This study therefore provides useful insights into resolving the contradicting arguments by analyzing some accounting measures (dividends and net assets) that Nigerian investors use in making investment decisions in order to take a standpoint whether or not, they significantly affect stock prices. Data obtained from the Nigerian Stock Exchange Fact Book and Annual Reports and Accounts of firms listed on the floor of the Nigerian Stock Exchange for the period 2001-2013 were obtained and analyzed using the Ordinary Least Square (OLS) technique. On the basis of the analyses, it was found among others that accounting information are the major determinants of stock prices in the Nigerian capital market. Based on the findings of this study, it was recommended among others that capital market regulators and accounting standard setters in Nigeria should properly educate investors on the attributes of accounting variables across the industries as these significantly have impact on the prices of stocks in the country.

Keywords: Stock Price, Stock Price Determinants, Dividends, Net Assets

JEL classification:   D53 - Financial Markets,   E43 - Interest Rates: Determination, Term Structure, and Effects,   E44 - Financial Markets and the Macroeconomy

SciPap 2015, 23(1), 753

Received: 1 January 2015 / Accepted: 8 April 2015 / Published: 27 April 2015