Yes, lack of smoothing is usually taken as a bad signal.
Irrelevance only holds in perfect capital markets. The main explanation behind dividend smoothing is agency costs. Intuitively, shareholders do not want the management to have a lot of cash because then they can buy Ferraris, planes, etc.
Irrelevance only holds in perfect capital markets. The main explanation behind dividend smoothing is agency costs. Intuitively, shareholders do not want the management to have a lot of cash because then they can buy Ferraris, planes, etc.