Explain how to compute dividend yield and discuss how it is used in analysis of a company's financial condition.
What will be an ideal response?
Dividend yield is the ratio of annual cash dividends per share divided by the market value per share of stock. The resulting dividend yield represents the annual amount of cash dividends distributed to common shares relative to their market value. Dividend yield can be used to identify whether a stock is an income stock or a growth stock. Companies that pay large dividends on a regular basis are income stocks. Companies that distribute little or no cash but use the cash to finance expansion are known as growth stocks.
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J. J. Johnson has decided to supplement his income by selling beehives. He expects to sell 25,000 hives in 2010 . He ended 2009 with 2,500 completed hives in inventory and would like to complete operations in 2010 with at least 2,800 completed hives in inventory. There is no ending work in process inventory. One beehive holds about 250 bees. The bees are purchased for $4.00 per 1,000 bees. The
hives sell for $15.00 each. What would be the total of the 2010 period sales budget? a. $378,000 b. $375,000 c. $379,500 d. $376,500
A common business transaction that would not affect the amount of owners' equity is
a. signing a note payable to purchase equipment. b. payment of property taxes. c. billing of customers for services rendered. d. payment of dividends.
Jetson Corporation Jetson Corporation reported the following information for the year ended December 31, 2012. Revenue $14,000,000 Expenses 11,500,000 Dividends 1,000,000 Retained earnings at December 31, 2012 1,750,000 Refer to the selected information provided for Jetson Corporation. What was the retained earnings balance on December 31, 2011?
A) $ 250,000 B) $2,500,000 C) $1,500,000 D) $ 350,000
Which item below would most likely not favor buying (versus renting) a personal residence?
A) You expect inflation to increase. B) You expect an increase in income taxes. C) You expect mortgage rates to rise. D) You anticipate relocating frequently because of your job.