The effect of earnings per share, dividend per share and net tangible assets per share on share prices : an empirical study on selected property shares listed on Kuala Lumpur Stock Exchange / Mohammed Yusoff Abd Rahman

The movement of share prices is influenced by both internal and external factors. The objective of this study is to see how far earnings per share ( EPS ), dividend per share ( DPS ) and net tangible assets per share ( NTA ) affect the prices of selected property shares listed on The Kuala Lumpur Stock Exchange ( KLSE ). EPS, DPS and NTA are taken as independent variables while share price is the dependent variable. All independent variables data are taken from balance sheet whereas the dependent variable data is based on the closing prices at the end of each fiscal year. The data taken for this study are eight years from 1991 until 1998. Thirteen property companies have been chosen as samples. They are all members of KLSE Composite Index. They represent all the property shares listed on KLSE. Two methods of linear regression have been used. Simple linear regression is used to see the significance of each independent variable in determining the share prices and multiple linear regression is used to see the significance of all independent variables in determining the share prices. This study found that two independent variables, EPS and NTA have no significant influence in deteimining the share prices. Meanwhile DPS has a significant influence in determining the share prices. A regression model was then developed to predict the share prices. However the accuracy of die model is still dependent upon other external factors.