Assume Lenny Company manufactures specialized computer per
Question and Solution
Assume Lenny Company manufactures specialized computer peripheral parts like speakers and modems. It is a new company that has been in operation for just two years. During those two years, Lenny’s stock price has increased over 400%. Lenny does not pay dividends nor does the company plan to do so in the future. However, the company’s stock seems to be heavily traded. Why do you think there is so much interest in buying Lenny’s stock if stockholders do not receive dividends?