Beginning of March 2010 was Bill Ritterath, Chief Financial Officer of Daktronics, Inc., meeting in his office with Jim Morgan, CEO, and Alered (Al) Kurtenbach, President of the Board, on the increase in dividend payments to shareholders. Daktronics was the world’s leading suppliers of electronic scoreboards, large electronic display systems and digital messaging solutions for use in sports, transportation and communication. The company had gone through a difficult period of the last three years w … Read more »

Beginning of March 2010 was Bill Ritterath, Chief Financial Officer of Daktronics, Inc., meeting in his office with Jim Morgan, CEO, and Alered (Al) Kurtenbach, President of the Board, on the increase in dividend payments to shareholders. Daktronics was the world’s leading suppliers of electronic scoreboards, large electronic display systems and digital messaging solutions for use in sports, transportation and communication. The company had gone through a difficult time in the last three years with the downturn in the economy and the sudden reversal in the company’s operating and financial performance. Sales increased by security analysts expected from a high of around $ 581 million in 2009 to an estimated value of $ 424 million for the 2010 fiscal year ends fall Mai [1]. Share price had from a high of $ 38.66 per share on 1 December 2006 to $ 7.72 per share on 3 March 2010 please. But with the economy showing signs of recovery from the recession, thought Dr. Kurtenbach it was time Daktronics’ review its dividend policy: “We can afford it, given some additional cash to shareholders our confidence that the company around turning and business is improving. “Cash and balances have been rapidly growing and the prospects for future cash flow was positive. When deciding Kurt Bach wanted it based the current cash position and future cash flow projections based on an evaluation of the company: “I do not think that this short-term dividends to holders at the expense of long-term reward shareholders,” Dr. Kurtenbach said Mr. Ritterath a recommendation at the next board meeting (in four weeks) on a new dividend, to make the distribution of both the height and shape.
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Thomas J. Cook
Source: North American Case Research Association (NACRA)
26 pages.
Release Date: 1 September 2013. Prod #: NA0240-PDF-ENG
Daktronics (S): dividend policy in 2010 HBR case solution