How a dividend cut could lead to increasing stock prices

Assignment Help Finance Basics

Reference no: EM131407985

When companies cut dividends, it is usually a bad sign for the stock. But apparently not at Monsanto. Several years ago, the company cut its dividend and the stock price went up.

REQUIRED:

Explain how a dividend cut could lead to increasing stock prices.

Reference no: EM131407985

Questions Cloud

Why a company might want to issue a hybrid security : What is a hybrid security, and how should it be reflected on the balance sheet, income statement, statement of cash flows, and statement of shareholders' equity?

How robust or intense is the competition in this industry : You are a senior manager for the highly successful regional CPA firm of Fine, Dee, Evah, Dense, LLP (Fine). Since its inception nearly 30 years ago, Fine's audit practice has exclusively consisted of auditing private and not-for-profit organizatio..

What are main and interactive effects in two way anova : How is two-way ANOVA similar to the randomized block design? How does it differ?- What are main effects and interactive effects in the two-way ANOVA?

Describe some other uses for a company’s cash : Describe some other uses for a company's cash. How could these uses benefit shareholders more than a stock repurchase?

How a dividend cut could lead to increasing stock prices : When companies cut dividends, it is usually a bad sign for the stock. But apparently not at Monsanto. Several years ago, the company cut its dividend and the stock price went up.

Evaluate the effectiveness of the blocking variable : With player skill level as a blocking variable, use the 0.025 level of significance in determining whether the treatment effects of the five racquets could all be zero. Using the 0.01 level, evaluate the effectiveness of the blocking variable.

How many shares of stock were outstanding after dividend : When Hershey Foods declared a 100 percent stock dividend, 149.5 million of its shares were outstanding. Assume that the stock dividend was declared and paid on the same day.

Identify the ethical dilemma : 1. Identify who is affected (who is the protagonist and who are the primary stakeholders); 2. Identify the ethical dilemma (what are the ethical issues);

Determine treatment effects of the two layouts could be zero : Two different machine control-button configurations are being tested.- At the 0.05 level, determine whether the treatment effects of the two layouts could be zero.

User Account

All Pages