This paper focuses on the impact of three dividend policy mechanisms i.e. dividend pay-out,
dividend per share and earnings per share) on shareholder's value as measured by (Market price
per share) of a sample of thirteen firms from the banking and oil industries between 2008-2012.
Using panel methodology and OLS as a method of estimation (the cross sectional regression
analysis for banks and oil companies), the results provide evidence of a positive relationship
between the dividend policy mechanisms (DPS, PAYR, and EPS) and MPS. The results further
reveal that EPS and PAYR has positive impact on MPS at 5% level of significance, whereas
PAYR for oil companies reveal that the relationship is negatively related to MPS at 1% level of
significance. There exist a positive insignificant relationship between DPS and MPS. The
implication of this is that firms should strive to formulate a dividend policy that ensures
continuity and stability in dividend payment as this impacts on the value of the firm, hence the
wealth of the shareholders.