Home > Integrated Waveguide Technologies (IWT) Mini Case- Dividend payouts and stock repurchases changed over time
Integrated Waveguide Technologies (IWT) Mini Case- Dividend payouts and stock repurchases changed over time
Create a 2 slide PowerPoint presentation in which it summarizes the answer from the mini case 14 question a. (1) below: It needs to include graphs, charts, and trends. The purpose of this assignment is to explain core concepts related to cash distributions and capital structure.--------------------------------------------------------------------------------
Question a. (1) What is meant by the term “distribution policy”? How has the mix of dividend payouts and stock repurchases changed over time?
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Chapter 14 Mini case Integrated Waveguide Technologies (IWT) is a 6-year-old company founded by Hunt Jackson and David Smithfield to exploit metamaterial plasmonic technology to develop and manufacture miniature microwave frequency directional transmitters and receivers for use in mobile Internet and communications applications. IWT’s technology, although highly advanced, is relatively inexpensive to implement, and its patented manufacturing techniques require little capital as compared to many electronics fabrication ventures. Because of the low capital requirement, Jackson and Smithfield have been able to avoid issuing new stock and thus own all of the shares. Because of the explosion in demand for its mobile Internet applications, IWT must now access outside equity capital to fund its growth, and Jackson and Smithfield have decided to take the company public. Until now, Jackson and Smithfield have paid themselves reasonable salaries but routinely reinvested all after-tax earnings in the firm, so dividend policy has not been an issue. However, before talking with potential outside investors, they must decide on a dividend policy. Your new boss at the consulting firm Flick and Associates, which has been retained to help IWT prepare for its public offering, has asked you to make a presentation to Jackson and Smithfield in which you review the theory of dividend policy and discuss the following issues.
