Why Do Companies Pay Dividends?

In this edition of Industry Focus, host Michael Douglass and Fool contributor Matt Frankel discuss dividends. They agree that dividends can be important features of a stock to income investors, and an established track record of paying dividends can be an excellent way for a company to build investor confidence. In this video, Michael and Matt discuss why companies pay, and sometimes cut, their dividends.

A full transcript follows the video.

Source: Fool.com