Profitability, Dividend Policy and Stock Prices: A Case Study on Kuwaiti Insurance Companies

The relationship between stock price, as a dependent variable, and earnings per share (EPS), dividendyield (DY), earning to priceratio (EP), riskpremium (RP), and retention ratio (PR), as independent variables, was investigated in this study using OLS regression approach. (2019) used the data of four insurance companies listed at Kuwait Stock Exchange (KSE) over the period 2009-2017 to examine the relation between dividend yield and stock price and found statistically significant negative relation between them. In his study, AlAli (2020) used the data of 10 banks listed at Kuwait stock exc hange (KSE) over the period 2008-2018 and concluded that there is a significant positive relation between stock price and earning per share (EPS). Interest rate (IR) has a huge impact in stock prices, Demirguc-Kunt andMaksimovic (1996) found that countries with low interest rate have strong stock market as compared to countries which have higher interest rate.