You are analyzing the dividend policy of Black and Decker, a manufacturer of tools and appliances. The following table summarizes the dividend payout ratios, yields, and expected growth rates of other firms in the waste disposal business.
|
Company
|
Payout Ratio
|
Dividend Yield
|
Ex. Growth
|
|
Fedders
|
11%
|
1.2%
|
11.0%
|
|
Maytag
|
37%
|
2.8%
|
23.0%
|
|
National Presto
|
67%
|
4.9%
|
13.5%
|
|
Toro
|
15%
|
1.5%
|
16.5%
|
|
Whirlpool
|
30%
|
2.5%
|
20.5%
|
|
Black & Decker
|
24%
|
1.3%
|
23.0%
|
a. Compare Black and Decker's dividend policy to those of its peers, using the average dividend payout ratios and yields.
b. Do the same comparison, controlling for differences in expected growth.