Dividend The part of a company’s PROFIT distributed to - TopicsExpress



          

Dividend The part of a company’s PROFIT distributed to shareholders. Unlike INTEREST on DEBT , the payment of a dividend is not automatic. It is decided by the company’s managers, subject to the approval of the company’s owners (shareholders). However, when a company cuts its dividend, this usually triggers a sharp fall in its SHARE PRICE by more than would be appear to be justified by the reduced dividend. Economists theorise that this is because a dividend cut signals to shareholders that the company is in a bad way, with more bad news to follow.
Posted on: Sun, 27 Oct 2013 13:30:37 +0000

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