Dividend policy plays a major role in maximization of shareholders wealth. The objective of this paper is to investigate how
dividend policy of a company affects market price per share. Secondary data was obtained from the Nigerian Stock
Exchange and annual financial statements of selected companies. The study employed ordinary least square (OLS) regression
technique using e-view software to establish the relationships between the variables dividend policy and stock prices of the
selected companies. The findings aligned with the Lintner’s (1956) findings that decrease in or non-payment of dividend
could convey wrong signals to investors.