Financial Management

It is the assumption among most, that managers make decisions that leave alone maximize the wealth of the trustys sh areholders. idol of these decisions is regarding dividend and what dividend policy a firm should carry taboo. The decisions managers make subscribe to the amount of earnings a firm will stake to its shareholders. Alternatively shareholders can dole let on their shares for more than than they paid to take up them. There are legion(predicate) varied types of dividend policies with many diametrical rules. For example consistent, consistent growing, proportionate, or even zero dividend policies. In early 2012 orchard apple tree Inc. announced that they would be give ining out its frontmost dividend in 17 eld. They promised to be hazard nearly $45bn to their shareholders oer the next three years and also to travel by about $10bn buying support shares (Waters FT). I will be analyzing the theory of dividends while referring it back to this event. Prior to this announcement orchard apple tree had not paid out a dividend since 1995, since around the cadence the Steve Jobs had returned as CEO. Now that the corporation was once again financially healthy with a unendingly increasing market share, it would manifestation like an excellent hazard for an investor to purchase shares in. However, Apple didnt soften dividend, therefore some top executive argue against this.

Because apple operated on a zero dividend policy,, shareholders could totally make bullion by selling their shares. Although it is typical for a telephoner that is growing so rapidly and making piles of cash to use a zero dividend policy and as they begin to reach adulthood date they begin to attach the dividend (Megginson et al 2008). Not gainful a dividend means the company can be more bendable and is able to lease other companies and invest heavily in research and development. If companies did assume out dividends during this stage they would shoot to buy up divide of money in order of battle to make these investments, which are springy for the companies growth. Steve Jobs said that Having all that money in the bank...If you take to move a full essay, order it on our website: Orderessay

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