Question: Refer to the financial statements of Canadian Tire Corporation Appendix

Refer to the financial statements of Canadian Tire Corporation (Appendix A) and RONA Inc. (on Connect) and the Industry Ratio Report (Appendix B on Connect).
Required:
1. Canadian Tire Corporation split its stock in the past. Describe the impact that the split would have on the market value of the stock compared to a company that did not split its stock. Why do some companies elect to split their stock?
2. Calculate the dividend yield ratios for Canadian Tire (assume a market price of $ 69 per share) and RONA (assume a market price of $ 10.5 per share) for the most recent reporting year.
3. Why would an investor choose to invest in a corporation whose board of directors does not declare and pay dividends?
4. Using the information from the following table, compare the dividend- related industry average ratios for the retailing industry to the media industry and the utilities industry. What type of investor would be interested in buying shares in a utility instead of a retailing company? Why?


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  • CreatedAugust 04, 2015
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