Episode Details

In this session, we started by looking at some bad reasons for paying dividends and a couple of good ones, including having an investor base that likes dividends, one iffy reason (dividends as a signal) and one borderline reason (that you can rip of lenders). We then looked at three questions that need to be asked in assessing dividend policy, starting with how much a company can afford to return to stockholders (FCFE), then looking at how much is actually returned in dividends and buybacks and finally assessing whether you trust management enough to give them the freedom to set dividend policy.
Slides: https://pages.stern.nyu.edu/~adamodar/podcasts/cfspr24/session23slides.pdf
Post class test: https://pages.stern.nyu.edu/~adamodar/pdfiles/cfovhds/session23test.pdf
Post class test solution: https://pages.stern.nyu.edu/~adamodar/pdfiles/cfovhds/session23soln.pdf

Learn more about your ad choices. Visit megaphone.fm/adchoices