The following selected information is available for two competitors, Nike, Inc. and Adidas AG: (in millions, except

Question:

The following selected information is available for two competitors, Nike, Inc. and Adidas AG:

(in millions, except for per share information) Nike Adidas

(in U.S. $) (in euros)

Market price per share ....................................$53.68........... €67.33

Total cash dividends ..........................................619................ 282

Dividends per share .........................................1.565.............. 1.35

Profit ....................................................................2,223.............. 791

Instructions

(a) Calculate the (1) payout and (2) dividend yield ratios for each company.

(b) Which company would investors favour for dividend income purposes? Explain.

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...