Dividend Policys of Companies - Essay Example

Only on StudentShare

Extract of sample
Dividend Policys of Companies

Companies which are in stages of growth or in initial stages normally have a sparing dividend policy because they reinvest or plow back much of their earnings into the company to experience growth and development (Financial Dictionary 2011). Established companies such as blue chips, Unilever and Wal-Mart being some of them, are inclined to relatively liberal dividend payout policies and grant dividends regularly on quarterly or half-yearly basis. For instance, Unilever (bearing a symbol of UL and listed on NYSE) pays a regular dividend every quarter; the most recent payout has been an amount of US$ 0.307 on November 8, 2011. Similarly, Wal-Mart paid a quarterly dividend of US$ 0.365 recently on December 07, 2011; a payment every quarter is being followed by the company. Dividends payment do assure shareholder satisfaction but some research, particularly Modigliani and Miller (MM)’s proposition on irrelevance depicts that a company’s performance and profitability is not affected by its dividend policy. Talking from the shareholder perspective, shareholders are more satisfied when they receive regular flows of dividends, even in small amounts but the factor of regularity ensures their confidence in the company. ...
Download paper

Summary

Customer Name Instructor Dividend Policy Dividend policy is a type of strategy followed by publicly-traded companies in order to plan out the outflow of dividends to shareholders. This policy comprises of the deportment on whether a company would payout profits as dividends or just retain them as retained earnings…
Author : nfeeney

Related Essays

Role of dividend signalling in corporate finance
32 pages (8032 words) Dissertation
The Effect of Recession on Dividend Policy.
12 pages (3012 words) Dissertation
Accounting Systems Design & Development.
9 pages (2259 words) Essay
Companies Research
8 pages (2008 words) Essay
Portfolio Theory's Underpinning Principles Need to Be Uncovered before Appreciating the Ceration of Capital Asset Pricing Model
6 pages (1506 words) Assignment
For and Against the Irrelevance of Dividend Policy
8 pages (2008 words) Essay
DIVIDEND POLICY
3 pages (753 words) Essay
Dividend Policy Corporate Finance Essay
3 pages (753 words) Essay
Corporate Valuation, Capital Structure and Dividend policy.
8 pages (2008 words) Essay
Security Analysis and Portfolio Management
7 pages (1757 words) Essay
essay questions
3 pages (753 words) Essay
AOL Project GSB
4 pages (1004 words) Essay
Got a tricky question? Receive an answer from students like you! Try us!