Tag Archives: financial

Advantages & Disadvantages of Dividends

Advantages & Disadvantages of Dividends

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A dividend is a portion of a company’s profit that is paid out to the shareholders, commonly in cash or stock. For investors, dividends present a great way to get periodic payouts on a high-yield investment. However, like all types of investments, there are drawbacks to any plan that routinely pulls out money rather than continues increasing revenue.

Pros of Dividends

Dividends certainly do have a place within the financial world. They provide a way for investors to place a large amount of capital that can then be used as a source of income, since it regularly brings in money. When you choose dividends, you can look forward to:

Profit while retaining a stake in the company – Normally, a stockholder would have to sell his or her stock in order to profit from his or her investment in a company. Dividends allow investors to profit from their investment in the company without selling their stock. This means you can look forward to regular returns.

Short-term results and long-term opportunities – An investor can continue to receive dividend payments from the company as long as the investor continues to hold stock. This can lead to significant dividend payments for a long-term investment, even though you’re seeing results over a short-term time frame.

Visible indications of your investment’s security – A continued, increased dividend payout is considered to be a good indicator of a company’s continued success. This allows you to quantify your gains easily.

Cons of Dividends

Despite their benefits, dividends aren’t for everyone. Before you and your financial advisor decide on this course of action, you’ll want to consider the following:

Dividends are not universally available – The Board of Directors is responsible for deciding whether or not a dividend is to be paid out to its investors. However, even if a company makes a significant profit, it is under no obligation to pay a dividend.

Tax repercussions – Dividends are often criticized as being subject to double-taxation, as the company is taxed on its income and the individual shareholder is also subject to paying taxes on the dividend payout. In the United States, dividends are subject to a 15 percent dividend tax rate. This is higher than what you can expect to pay on other types of investment windfalls.

Making the Decision to Use Dividends

Before you decide whether or not dividend investing is right for you, talk with your financial advisor. While dividends can be a great way to see regular returns on your investment, you might find that your unique needs are better served with stocks, bonds, or other financial options.

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Questions? Email me at wesley@thewandwgroup.com and visit our website at http://www.thewandwgroup.com . New Money Talk is a weekly article focusing on retirement, personal finance, and estate planning.
Comments and questions are welcome, but because of the volume of email, personal responses are not always possible.

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Warehousing Software Provide Effective IT Solutions for Your Inventory Management Needs

Warehousing Software Provide Effective IT Solutions for Your Inventory Management Needs

Choosing the best inventory software in order to manage the stocks of any business requires tracking inventory and establishing control over business operations. This translates into higher profits and higher return on investment over time. When you have the required inventory warehouse software at your disposal for the purpose of carrying out the management of your warehouse, you establish a way of knowing the levels of your present stocks. This helps you in determining what you should buy immediately and what you shouldn’t. There is a sizeable number of inventory warehouse software available in the market. All of these programs are reliable and efficient. However, every business has its specific mechanics and it is up to you to select the right software that caters to all your needs.

Choosing the best inventory entails awareness of the specific requirements of your business. When these requirements are taken into account, you must also note the limitations of your operational abilities. With this data firmly in your possession, you will be able to match your particular requirements with the features available in the inventory warehouse software.

The point to be noted here is that each inventory warehouse has its distinct features that may not be useful for each and every kind of business. In the software arena, one size does not fit all. This makes it absolutely necessary for you to choose only the best inventory software that will suit your business operations.

Inventory warehouse programs that have automated functions are efficient and extremely helpful since they automatically update the entire data as soon as a transaction takes place. Efficient warehousing does not simply mean counting stocks and ascertaining their locations. Rather, it also includes tracking sales, purchases and deliveries to and from your warehouse.

You must also keep in mind that the best inventory software should also be within your financial limit. There is no use for a great software that you know will control all your weak areas but it will be so heavily priced that you will not be able to purchase. You must select a software that you are able to buy without increasing your financial burdens.

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Financial Accounting has its Limitations

Financial Accounting has its Limitations

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from © Dreamstime.com If one takes a deeper look into the different aspects of accounting, one will find that it is not free from limitations. Financial accounting gives room for alternative treatment. Basically, accountancy is based on the ‘generally accepted principles’, but one will see that there is more than one principle when it comes to the documentation of a single item. The entities permit alternative treatments for different purposes. But it has to fall within the framework of ‘generally accepted principles’ that have gained acceptance. One of the flaws of financial accounting is that it does not provide timely information. But, this cannot be considered a limitation at all, since highly useful software applications of the likes of Myob are used to produce online and concurrent accounts and the balance sheets can be made available almost immediately. Manual accounting has got a problem or shortcoming with this. The information provided by financial accounting personnel is, at best, one that has got some historical interest only. What takes place is only the post-mortem analysis of the details. In fact, all businesses require access to timely information made possible at frequent intervals. Then, the management of a company will be in a better position to plan and take corrective actions.

As everyone knows, financial accounting cannot be expected to supply information at short notice. With the introduction of computerized accounting and customised soft ware, financial accounting is made easy. It generates monthly profit & loss accounts and balance sheets, and has overcome the limitations that existed earlier. There is some influence of personal judgment happening in financial accounting domain. This so-called ‘Convention of objectivity’ is acceptable and assumes some respect in the accounting area. This is due to the fact that personal judgment is required in order to record certain events and making estimates. It is well nigh impossible to maintain accuracy in future estimates and as a result objectivity suffers. For instance, if one wants to determine the amount of depreciation that has to be charged every year the estimation done cannot be counted authoritative, but just an approximation.

Financial accounting pays no attention to non-monetary information; transactions that are non- monetary in nature. Take a few examples, the intangible things like the extent of competition faced by the company, loyalty levels and efficiency of the employees etc. are some of the important matters which are of interest to the top management. But, accounting does not take note of such matters. Thus the end user of these kinds of financial information is, in effect, deprived of some crucial information that are of a non-monetary character. But, in today’s world, good accounting software or packages with MIS and CRM will be found to be useful in overcoming this limitation, but only partly. Financial accounting, in fact, does not supply one with detailed reports of analyses. But, there is no denying the fact that it enables one to study the overall result. The important information regarding the revenue, cost and profit of each product is not got by simply relying on financial accounting.

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Management Programs with Financial, Marketing, Retail

Management Programs with Financial, Marketing, Retail

Management institutes and schools are aware of the requirements of future students and always work towards offering various types of management programs. Some of the main management programs that are offered by B-Schools are Two Years Post Graduate Full Time management course, One Year Post Graduate Full Time management course, Part Time MBA, Executive MBA, Online MBA and Joint MBA.

Chartered Financial Analysis course is one of the best financial management programs. Other financial management programs are MBA in Finance and Marketing, Chartered Accountancy, Management of Business Finance, Cost & Management Accountancy. Some b schools also offered foundation course under financial management programs. Financial Management Programs are frequently offered by top companies to develop the leadership skills and analytical power of their employees. People gain industry-oriented experience in working areas such as financial planning, auditing, capital markets and accounting. For enrolling into a financial management program, you must have a graduation degree in Economics or Commerce. However the admission criteria differ from one b school to another and in one country to another. Candidates having relevant working experience are preferred. You’ll have to appear for entrance tests such as FMS, CAT, and GMAT for some of financial management programs.  

Executive management programs provide executives an opportunity to earn a Postgraduate Diploma in Business Management without interrupting their career. It is known as EMBA and it is equivalent to an MBA. Executive management programs enable the business professionals, executives, and managers of a number of organizations to boost their careers and look for growth prospects. Executive MBA is mainly designed for the professionals to renew their managerial skills. For enrolling into an executive management program, the candidates should have passed their graduation from a recognized institute or university. They must have three years of work experience at executive or manager level. The candidates willing to pursue an executive management program will have to appear for GMAT. Executive management programs train the candidates to take up a scientific approach while dealing with various aspects of business and handle responsibilities of senior management efficiently.

Many big organizations are entering into the retail market. A retail career is beneficial today. After completing a course in retail management, you’ll be recruited in supervisory or specialist roles. You can also enter into Even Management or Analyst profiles. Candidates having a degree in Retail Management course are engaged in the processes of client communication, merchandise shipments, sale and administration of stores. Topics such as Pricing, Store Operations, Human Resources Competitive Analysis and Merchandising are also taught through retail management course.  For enrolling into a retail management course at bachelor level, you should have passed 10+2 level exam from any recognized board or university. Candidates having a graduate degree or diploma with relevant work experience can apply for a master level retail management course.

There are many b schools in USA. Some of b schools which have been recognized as top b schools across the world are listed below:

Harvard University (MA)
Stanford University (CA)
University of Pennsylvania (Wharton)
Massachusetts Institute of Technology (Sloan)
Columbia University (NY)
University of Chicago
New York University (Stern)
Kellogg School of Management Northwestern University (IL)
Columbia Business School (NY)
Chicago Graduate School of Business, University of Chicago

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A Multibagger stock tips that can give good returns

A Multibagger stock tips that can give good returns

Bullish on Jindal Drilling, JM Financial, Gujarat Ambuja Exports and Lakshmi Electrical Control Systems.

Q: What is the story in Jindal Drilling?

A: This is a drilling contractor having five jack-up rigs. If you see the performance, yesterday they have announced their Q3 results, that translates into an earning per share (EPS) of about Rs 10 plus. If I go by the full year performance, since we have the nine months performance in front of us, with bottom-line of about Rs 75 crore and top-line of about Rs 750 crore, FY11 should result in a top-line of about Rs 1,100 crore and bottom-line of about Rs 100 crore. And that makes the share ruling at a PE multiple of about ten times because EPS should be close to about Rs 42-43.

Traditionally, this stock tips has been ruling at a PE multiple of 16-18 times. But because of the carnage we have been seeing in the market and specially in this midcap or smallcap stocks, they have all taken beating beyond proportion. If you go by the financials performance, the five jack-up rigs have long tenure also. They have been deployed and the term of the contracts will be expiring from October ’11 to as long as March ’14. So, there will be having the periodical renewal also of these rigs at a higher level which will keep increasing their revenue as well as the profits. There is a very small debt of about Rs 4-5 crore in the books of the company.

So, taking all this into consideration, I think that stock has very limited downside. It has a good upside potential. If somebody can keep a view of about six months, it can give a price target of about Rs 550 from the current level.

Q: Your second pick is brokerage, a sector that hasn’t done too well lately, JM Financials?

A: That’s right. In fact that was the idea of choosing the stock because wherever we have seen this kind of negative perception for the sector or for the stock, the price has taken a huge beating and in fact it applies to JM Financials also. We have seen price moving to about Rs 45, maybe three-four months back on the rumour of the stake sale by the promoters and all that, when that was done by the Enam promoters. At that time, it went up to Rs 45.

If I go by the pure financials by the core business model of the company, this has a good presence in the broking mutual fund business, realty asset management. If we take a call on the earnings also, the share is ruling at a PE multiple of close to about ten because company has been consistently delivering the performance, the bottom-line has been about Rs 145 crore for Q3 on a top-line of about Rs 702 crore.

If you see the results, it has been equally divided in all three quarters that means they have a stable working and this is expected from Q4 as well. So, taking all this into consideration, whenever you have renewed interest coming back in these stocks or maybe because of the some corporate announcements or some expectations coming, the stock takes good jump from these levels. So, downside is virtually low. But one can expect a price to move to at least Rs 30 in next six months.

Q: What about Gujarat Ambuja Exports?

A: We don’t often hear about this stock. But this is an interesting company, they have about 13-14 plant, they are into the maize processing, solvent extraction, flour mills, they have presence in Madhya Pradesh, Gujarat and Maharashtra. But their major presence is in Ahmadabad with about 10-11 plant. Also, they have the cotton yarn, they have 73,000 spindles.

If you go by their Q3 performance, they have posted a top-line of about Rs 650 crore, while the topline for first half H1 was 650 crore. Even the earnings have been quite good in the Q3 with EPS of close to about Rs 2 to 2.10. But if you go by the cotton yarn industry, they have been making very good money and the company has presence in Gujarat where you have good cultivation of cotton. They have the advantage of acquiring the cotton on a longer-term basis. They have always been prudent in having their better inventory management in respect to the raw material as well as in respect to the selling. So, taking a positive call on the cotton yarn because as I said they have 73,000 spindles that is going to give them a very robust performance.

As I said Rs 650 crore turnover came in Q3, but even if I don’t extrapolate the same the company should be able to post a top-line of close to about Rs 2,000-2,100 crore for entire FY11 because they have already achieved a turnover of over Rs 1,350 crore. So, they should be able to have a turnover of Rs 2,100 crore. Even the EPS is likely to be about Rs 7 because they have already posted an EPS of Rs 4.50-4.60. So, they should be able to post an EPS of close to about 7.

The share is now ruling at a PE multiple of less than five. There have been institutional investors also in the company for quite sometime, so they must also be keeping the watch and the corporate governance issues and all that because there were some issues in the past as well for the company. But I don’t think now those things are there. It is multidivisional, multi-location company with good presence in all the business segments and with a marketcap of close to Rs 450 crore, I think this is quite an interesting company at these levels.

Q: What are your thoughts on Lakshmi Electrical Control Systems?

A: This is LMW Group company and it’s a smallcap stock having a marketcap of about Rs 60 crore. Couple of year back, they had the cotton yarn spinning units also along with them which they have hived off to a subsidiary and now that is in the process of getting sold off. Part of that fund is still lying in that project. But the core business of the company is low voltage switchgear and the stabiliser and that’s a very profit making venture.

If you take the present financials, they have a very low equity of Rs 2.5 crore with face value of Rs 10 and that translates into marketcap of about Rs 61-62 crore. For nine months, they have already posted a top-line of about Rs 110 crore with EPS of close to about Rs 33-34 with bottom-line of Rs 7.8 crore. In fact this low voltage switchgear, which is also with the big players like Siemens, ABB, they have their presence in high voltage switchgear and low voltage switchgear, but this product has a very good demand. They have a very good presence in the southern market.

FY11 should have a topline of close to about Rs 140-145 crore. Generally, Q4 result is always better for the company with EPS of close to Rs 45. I am very positive on the financial performance expected from the company for FY12. I won’t be surprise to see if they post a growth of about 30% in the bottom-line. So, they should be able to post an EPS of close to Rs 55 for FY12. If I take that earning, share is available at a PE multiple of 5.

This stock has been showing lot of volatility in this market, maybe couple of months back it went up to Rs 350-360 and now has fallen to about Rs 250. So, this should be an opportunity to buy this stock at these levels with a view of about three-six months again to see it moving back to close to about Rs 400.

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Fast Cash Check Cashing Instant Cash Drawer Scheme

Fast Cash Check Cashing Instant Cash Drawer Scheme

Worried about how would you tackle with unexpected expenses prior to your payday? Don’t worry as fast cash check cashing scheme is here to help you out in times of financial difficulties. This scheme is accessible by means check cashing options that can be obtained to fulfill important needs until your next payday. It can cater to a diverse range of financial problems with ease such as:

– Car repair.
– Home repair.
– Medical bills.
– Unexpected travel.
– Electricity, grocery or any other utility bills.

The fast cash check cashing scheme is a short term and unsecured option of raising funds that is you need to keep any type of security with the lender. The service is very much available online and with a click you can get rid of all your financial problems. . These schemes are mainly formulated for those borrowers who are facing dubious credit situation in their life. With this you can easily fulfill your multiple purposes. In fact, lenders will not constraint in this matter. This scheme has been designed to make it easier for the people to avail the funds the same day and without many formalities.

The interest on the amount borrowed is very less in comparison to other creditors and also they do not undergo the screening of the bad credit records and moreover does not ask to pledge your debit card that you might or might not be having. The process of registration is very simple you just need to fill an online application without worrying about the paper pen formalities unlike other schemes. The processing fee is very nominal and so the time taken. And thus you can avail the benefit the very same day. You can repay the amount later according to your convenience as per the agreement between two parties.

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