Financial Management

It is the assumption among most, that managers make decisions that will maximize the wealth of the firms sh areholders. uncomparable of these decisions is regarding dividend and what dividend policy a firm should carry taboo. The decisions managers make pick up the amount of earnings a firm will exact off to its shareholders. Alternatively shareholders can sell their shares for more than they paid to train them. There are many varied types of dividend policies with many contrastive 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 kayoed its first dividend in 17 long time. They promised to wages pole nearly $45bn to their shareholders over the next three years and also to travel by about $10bn buying buns shares (Waters FT). I will be analyzing the theory of dividends while referring it back to this event. Prior to this announcement Apple had not paid out a dividend since 1995, since around the cadence the Steve Jobs had returned as CEO. Now that the familiarity was once again financially healthy with a always increasing market share, it would face like an excellent prospect for an investor to purchase shares in. However, Apple didnt net dividend, therefore some qualification argue against this.

Because apple operated on a zero dividend policy,, shareholders could single make money by selling their shares. Although it is typical for a play along that is growing so rapidly and making haemorrhoid of cash to use a zero dividend policy and as they begin to reach maturi ty date they begin to addition the dividend! (Megginson et al 2008). Not paying a dividend means the company can be more bendable and is able to capture other companies and invest heavily in research and development. If companies did pay out dividends during this stage they would need to buy up hemorrhoid of money in order to make these investments, which are racy for the companies growth. Steve Jobs said that Having all that money in the bank...If you take to get a full essay, order it on our website: BestEssayCheap.com

If you want to get a full essay, visit our page: cheap essay