Capital Structure and Leverage Practices Essay Example | Topics and Well Written Essays - 1000 words

Capital Structure and Leverage Practices - Essay Example The family dollar company is basically a chain of stores that offer different assorted products such as clothing, food, and other supplies that a common family needs. This fact about the company's standing as a proper resource of practical items that is needed by the common family gives it a bit of an edge in making specific name in the market. Refinements and Growth. Refinements have been made through the years but its marketing edge remains to be meeting the needs of its customers for good quality but low cost merchandise (Family Dollar). The company basically thrived within a basic improved growth during the 1980's but gradually the growth slowed down during the 1900's when particular retail store brands already entered the arena of modern business industries such as that of Wal-Mart. "Over the years, Family Dollar has matured into a highly sophisticated retailer while staying true to its roots. An efficient distribution system, astute management and adoption of new technology and systems have enabled Family Dollar to keep up its industry-leading metrics in new store sales productivity, return on invested capital and comparable-store sales" (http://findarticles.com) Today, although the Family Dollar company remains to be within the competition, it is surely in need of improving its ways to keep up with what other competitor organizations put up for the establishment of a better standing in the industry of international retailing. The company now belongs to the Fortune 400 and S&P 500. THE COMPANY'S CAPITAL STRUCTURE AND LEVERAGE PRACTICES During the 1970's it could be seen how the stock shares of the company grew to a level of competitive stand within the stock market. This was the time when it went public for at least $14.50 per share. From this particular standing, the business began to grow towards prosperity and increased rate of profits in an annual basis. As the business grew towards a more inquisitive sense of market control, the ways by which the business have seen their practical position in the industry as a particular competitive organization in the field of retail marketing and product distribution. The CEO's that come and go in the company have effectively managed the capital of the business. However, because of the preserved views towards earning more through establishing more branches, the balance of seeing matters clearly have placed the Family Dollar in quite a stable yet non-moving position in the industry as larger organizations come into the scene. This is the reason why there is a need to shift the focus from profit to customer satisfaction considerations. "Despite being the underdog in sales and store count, Family Dollar is still the favored stock of many analysts due to a strong growth outlook and best-in-class financial metrics that give it an edge over Dollar General" (http://findarticles.com) The company seems comfortable going public as it constantly declares dividends while also actively looking for investment opportunities. The company gives quarterly dividends to its investors and has specifically reported an 8% increase in dividends at the start of 2009. Recently, Family Dollar Company was reported to make a presentation "to the investment community at Barclays Capital Retail and Restaurants Conference" (Family Dollar). ANALYSIS OF THE COMPANY'S CAPI