Company Financial Analysis of œThe Murray Ohio Manufaturing Company case study
Questions to be answered after reading the case:
1)Analyze Murray Ohio’s recent financial performance and cash flows. Can the company afford to maintain its current dividend if operating conditions remain about the same?
2)Evaluate management’s business strategy for the future. What does this strategy imply for the company’s future cash requirements? Given this new strategy, is the company more or less likely to maintain its current dividend policy?
3)Is there an alternative strategy that is better than management’s proposed strategy for increasing shareholders’ value? Is the company’s current management likely to pursue this alternative strategy? If not, is the company an attractive takeover target?
4)What are the implications for current stockholders of Murray Ohio? What should the Commonwealth Investment Group do?