Dividends, buybacks, and investor expectations: are French firms truly catering to investor demand?

Mohammed Amine Rharbi, Sami Ben Larbi () and Nicolas Aubert
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Mohammed Amine Rharbi: CERGAM - Centre d'Études et de Recherche en Gestion d'Aix-Marseille - AMU - Aix Marseille Université - UTLN - Université de Toulon, UTLN - Université de Toulon
Sami Ben Larbi: CERGAM de Toulon - Centre d'Études et de Recherche en Gestion d'Aix-Marseille/Equipe de recherche de Toulon - CERGAM - Centre d'Études et de Recherche en Gestion d'Aix-Marseille - AMU - Aix Marseille Université - UTLN - Université de Toulon - IAE Toulon - Institut d'Administration des Entreprises (IAE) - Toulon - UTLN - Université de Toulon
Nicolas Aubert: CERGAM - Centre d'Études et de Recherche en Gestion d'Aix-Marseille - AMU - Aix Marseille Université - UTLN - Université de Toulon, AMU IAE - Institut d'Administration des Entreprises (IAE) - Aix-en-Provence - AMU - Aix Marseille Université

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Abstract: Purpose Based on a theoretical framework that favors catering theory, this paper aims to determine whether French companies respond to investor demand and preference for share repurchases and dividend payments. Design/methodology/approach The study is based on data from the Thomson Reuters Eikon database and focuses on French companies listed on the CAC All-Tradable index from 2000 to 2023. The study sample comprises 183 companies over 24 years, representing a total of 4,392 observations. The authors employ logistic regression to analyze the impact of independent variables on payout decisions. Findings The study finds evidence that French companies negatively respond to investor demand for dividend payments, share repurchases, and difference premiums. Originality/value To the best of the authors' knowledge, this study is the first to test catering theory on share repurchase in the French context and to study the catering effect on investor preferences. To do so, the study empirically examines whether the listed French companies react to investor demands and preferences for different forms of compensation, specifically the distribution of dividends and share buybacks.

Keywords: difference premium; repurchase premium; dividend premium; catering theory; dividend; share buyback; share buyback dividend catering theory dividend premium repurchase premium difference premium (search for similar items in EconPapers)
Date: 2025-10-30
New Economics Papers: this item is included in nep-fmk
Note: View the original document on HAL open archive server: https://hal.science/hal-05369144v1
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Published in Managerial Finance, 2025, pp.1-22. ⟨10.1108/MF-11-2024-0830⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05369144

DOI: 10.1108/MF-11-2024-0830

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