• Capital Structure in a Perfect Market
    trade for a price of$22 per share. Omega Technologies has 20 million shares outstanding as well as debt of $60 million. 14-5-a. According to MM Proposition I, what is the stock price for Omega Technologies? V(alpha) = 10 x 22 = 220m = V(omega) = D + E E = 220 – 60 = 160m p = $8 per share. 14-5-b...
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  • Dividend Policy
    An Empirical Analysis of Dividend Payout Policy Indian Corporate ABSTRACT In the present paper an attempt has been made to assess the dividend payout policies of Indian Companies. For the purpose of study BSE Sensex -30 companies have been selected as sample for the study. To study impact of...
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  • Effect of Dividend Payment on Stock Prices Case Study of Nairobi Stock Exchange 20 Share Index
    EFFECT OF DIVIDEND PAYMENT ON STOCK PRICES CASE STUDY OF NAIROBI STOCK EXCHANGE 20 SHARE INDEX GROUP PRESENTATION Submitted by Submitted to the Department of Finance in partial fulfillment of the Financial Seminar Course; University Of Nairobi. October, 2010. COURSE INSTRUCTOR: DR. JOSIAH...
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  • Project Instore Plc
    POUNDSTRETCHER 2 1.3 PROFIT WARNINGS 2 CHAPTER TWO 3 2.0 CAPITAL STRUCTURE 3 2.1 CAPITAL STRUCTURE THEORIES 3 2.2 DIVIDEND POLICY 5 2.3 THEORIES OF DIVIDEND POLICY 5 2.4 DIVIDEND POLICY OF THE COMPANY 6 2.5 COMPANY VALUATION 8 3.0 THE COMPANY FINANCIAL RATIOS ANALYSIS 11 CHAPTER FOUR 20 ...
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  • Financial management
    Question The dividend discount model tells us that the value of a firm is equal to the present value of its expected dividend payments. Some firms have never paid dividends and have no intention of doing so. Does this mean that these firms are worth nothing? Discuss with reference to academic...
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  • assesment
    company will receive dividends on their shares only, if the company make profit. Company use a dividend policy, which is a set of guidelines that is used to determine what part of the profit will be paid to the stakeholders. Miller and Modigliani (1961) outline the dividend irrelevance hypothesis in a company...
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  • Corporate Finance
    ................... 90 The ModiglianiMiller theorem .................................................................................... 91 ModiglianiMiller and Black–Scholes ........................................................................... 93 ModiglianiMiller and corporate taxation.......
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  • Dividend
    will distribute cash to its shareholders by issuing a dividend or undertaking a stock repurchase. To issue a dividend, the firm’s board of directors must authorize the amount per share that will be paid on the declaration date. The firm pays the dividend to all shareholders of record on the record date....
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  • Thesis
    series of dividends that grow at a constant rate. According to Gordon (1959), a dividend per share is payable within one year, and the assumption that the dividend grows at a constant rate in perpetuity; the model solves for the present value of the infinite series of forthcoming dividends. There is...
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  • Capital Structure
    objectives • Discuss sources of finance available to an entity • Explain the Cost of Capital • Discuss the effects of gearing, and differentiate between business risk and financial risk • Describe Traditional and Modigiliani & Miller models • Calculate WACC • Discuss issues that a firm needs to consider...
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  • Corporate Governance in Mongolia
    investment decisions aren't affected by financing decisions. Modigliani and Miller made two findings under these conditions. Their first 'proposition' was that the value of a company is independent of its capital structure. Their second 'proposition' stated that the cost of equity for a leveraged firm is...
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  • Empirical Corporate Finance
    2 FPL Case 3 2.1 Expected Reaction of Stock Price 3 2.1.1 The Modigliani/Miller Theorem 3 2.1.2 The Tax Theory of Dividends 4 2.1.3 The Signaling Theory of Dividends 5 2.1.4 Agency Costs 5 2.1.5 Theory of Dividends Based on Tax Clienteles 6 2.2 Chart in the Light of Previous Theories...
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  • capital structure
    4, Roosevelt Road, Taipei, 10617, Taiwan, Republic of China. Accepted 14 June, 2011 This paper examines the relative importance of the Modigliani-Miller theorem, the trade-off theory, the pecking order theory and the market timing theory in the financing decisions of the firms for the Four Asian...
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  • Doctor
    your income to arrive at taxable income. This reduces your taxes. When you use equity, you are not allowed to deduct payments to equity (such as dividends) to arrive at taxable income.  Adds discipline to management: When a firm has little or no debt, managers become complacent due generation of high...
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  • Dividend Policy (Good )
    Dividend Policy Vinod Kothari Corporations earn profits – they do not distribute all of it. Part of profit is ploughed back or held back as retained earnings. Part of the profit gets distributed to the shareholders. The part that is distributed is the dividend. The ratio of the actual distribution...
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  • Dean Wu
    Dividend Pay Out Policy Essay General Outline Why some company pay dividends whereas others do not? This question has been discussed for so long time since the publication of the original Miller and Modigliani (1961) irrelevant theory. The theory has several assumptions such as perfect capital market...
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  • term paper
    several decades, the gap between capital structure theories and practices still exist. Various theories have been advanced by the finance scholars to explain the financing patterns of firm. These theories are always been subject of considerable debate due to inherent controversies. The extensive debate from...
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  • Capital S
    reserves and surpluses of an enterprise. The historical attempt to building theory of capital structure began with the presentation of a paper by Modigliani & miller (MM) (1958). They revealed the situations under what conditions that the CS is relevant or irrelevant to the financial performance of the listed...
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  • Optimise Capital Struture
    the Capital Structure: Finding the Right Balance between Debt and Equity by Meziane Lasfer Executive Summary • Just over 50 years ago Miller and Modigliani (1958) showed that under a certain set of conditions —namely perfect capital markets with no taxes and agency conflicts—a firm’s capital structure...
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  • Testing
    the investment policy of a firm should be based only on those factors that will increase the profitability, cash flow or net worth of a firm. Modigliani and Miller (1958) stated that we should not “waste our 49 Journal of Business Case Studies – September 2008 Volume 4, Number 9 limited worrying...
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