Microsoft Dividends

Microsoft Dividends - current investors happy, and possibly...

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Darryl Williams FIN 320-26 22 September 2011 Microsoft Dividends Much is still unknown of Microsoft’s motives for increasing its quarterly dividend, but no one seems to be complaining about it; especially Microsoft investors. The quarterly dividend increased from $0.16 to $0.20, which is a 25% boost. This is Microsoft’s largest dividend increase since 2004. The company is not necessarily doing much better than it was last year, even though it increased its dividend pay-out of $0.03 more; a 23% increase then. Maybe Microsoft is making an attempt to appease its investors, who have been demanding a larger increase in dividends. In this type of economy, capital appreciation is not enough to satisfy stockholders anymore. Microsoft realized this, and decided that increasing their dividends would keep their
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Unformatted text preview: current investors happy, and possibly attract new investors. Microsoft also has to compete with Google and Apple, who have had much greater increases over the past few years. Microsoft is not losing money, but they are not making nearly enough to keep up with their competitors. Microsoft saw that they were too late in entering the new markets that are dominated by its competitors, so they decided to make up for their lack of initiative by keeping the company stable and the investors pleased. No one knows how long this strategy will last, but at the moment, other large companies are following in the footsteps of Microsoft....
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