Abstract
Initial determination of the payout ratio should be an integral part of each company strategy; it is a cornerstone of a long-term operation of any company. The aim of this contribution is to analyse the possibilities of determining the payout ratio of the company using dividend models and to design the most optimal application of the dividend model, and to define the limitations for the application. The data required for the application of the dividend models are obtained from the annual reports of Komerční banka, PLC. for the years of 2006-2018. The obtained data are used to calculate the classical payout ratio model, and subsequently to determine the payout ratio according to the Lintner model. Using the method of comparison, the obtained results for the application of the pay ratio are contrasted. The classic payout ratio model coincided directly with the results of the payout ratios of Komerční banka, PLC. and therefore turned out to be optimal for the application. The Lintner model is considered in literature to be very well functioning. However, this research confirmed that the resulting values of payout ratios after the application of the Lintner model are unacceptable in the long run.
Highlights
In the business sphere, current turbulent times demand in particular determination of a quality company strategy
Initial determination of the payout ratio should be an integral part of each company strategy; it is a cornerstone of a long-term operation of any company
The obtained data are used to calculate the classical payout ratio model, and subsequently to determine the payout ratio according to the Lintner model
Summary
Current turbulent times demand in particular determination of a quality company strategy. There is no resource in the world that defines the ideal payout ratio. This value depends on the sector of business in which the particular company is located, and the results vary. It is possible to determine decidedly, based on the payout ratio, the percentage of the profit that can be paid to the shareholders in dividends [3,4]. This apparently simple model is accompanied by a rather complex dividend policy, combined with a number of arguments and theories.
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