Some companies have been known to pay dividends to current stockholders while simultaneously raising capital through a new equity issue. Generally, this behavior is explained by the need to discipline managers by regularly exposing the company to the extra scrutiny involved in an equity issue.

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This behavior is commonly referred to as the "dividend puzzle" and is often attributed to the disciplining effect of equity issues on corporate management. By requiring regular equity issuances, managers are forced to act in the best interest of the company as a whole and make decisions that will benefit all shareholders, not just those receiving dividends.

Some Companies Have Been Known to Pay Dividends to Current