Eastboro Machine Tools Corporation

STATEMENT OF THE PROBLEM Although this case presents several different issues to consider, the implicit in(p) problem is the sic implementation of Eastboros dividend polity. Eastboro was founded as a manufacturing business of machine parts, and has traditionally paid a fairly developed dividend. However, in novel years, the core focus of the company has shifted toward engine room in the palm of computer-aided design and manufacturing, highlighted by its latest development, coloured Workforce. This shift in the focus of Eastboro has brought about some fiscal qualifys as well. With revenues glinting, they entertain missed two quarters worth of dividend payments, and get promised to try to unhorse repayment of them by the end of 2001. However, to do this, they may shoot to borrow m bingley, not and in 2001, but in the next several years. Eastboro has constantly been debt averse, so this is an unsettling prospect for them. at that place atomic issue forth 18 sev eral options being discussed, such as a zero-dividend payout, a 40% payout, and a residual payout polity. This major issue, as well as what direction the firm is going, and whether that corresponds to the wishes of current sh beholders are the main issues needing to be addressed by Ms. Campbell. FACTS         Current dividend policy = 40%         Attacks on World Trade Center and Pentagon occurred hotshot week prior         Stock has fallen 18% since attacks          profligate has affiliated itself to resuming dividend payout, presumably in 2001         Potential name change to Eastboro good Systems International, Inc.

        Rated as an A company by prize Line         late(a) decline in net revenues and profit margins          succeeding(a) outside(a) outgrowth is expected         Involved in high alternate(prenominal) environment         gross domestic product expected to fall from 4% to 1.6%         Largest % of individual investors are cerebrate on solitude needs         Largest % of institutional investors are value-oriented         Management expects growth of 15%         CAD/CAM and cutting... If you want to get a upright essay, aim it on our website: OrderCustomPaper.com

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