In an unstable environment, the investors become more aware of the importance of a good assessment of the risk implied by their investment. Therefore, much attention is given to the amount of information provided by the issuer, as well as to the signals it offers to investors. The financial literature emphasizes the role of the dividend policy in signaling the financial soundness of the companies. Our paper aims to verify if the dividend and financing policies of the companies have a role to play in the share valuation in an unstable economic environment and if their explanatory power differs with the phases of the economic cycle. The period 2006-2010 was chosen in order to test our model, as it corresponds to a period of the economic cycle similar to the present one, which may lead to similar behavior of the market participants. Moreover, the behavioral economics sustains the importance of the recent experiences in shaping actors’ responses in conditions perceived as similar. Our analysis is made on a worldwide database including 5391 companies listed in the most important market indices on 82 national capital markets. We chose to multiple linear regressions for successive yearly periods in order to put in evidence in a straight and unambiguous manner the influence of the dividend and financing policies on the share valuation. It puts in evidence that the dividend policy remains an important signal for the investors and it is taken into consideration even more seriously in unstable economic environment. Moreover, the financing policy is emphasized as important signal in investors’ eyes.
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