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Answer : Its profits increase. Explanation : When a company is more profitable, it's stock is in higher demand, and higher demand means a higher price.
An increase in demand for the company's stock
Investors in the company will drive the stock price up for Company A if they are more confident that Company A's cash flow will be closer to their expected value. Company A's stock price will be higher than Company B.
A good earnings report
It's profits are increased.
An increase in demand for the company's stock
Answer : Its profits increase. Explanation : When a company is more profitable, it's stock is in higher demand, and higher demand means a higher price.
Stock options allow you to buy stock in a company at a certain price, no matter what the price of the stock is currently. There is usually a time period associated with the offer. Sometimes this could be a sweet deal (if the stock is currently higher than the option) to worthless (if the option price is higher that the current stock price). You also don't have to have the funds to exercise the option, you can have a brokerage company exercise the option, then sell the stock at the higher price, with the difference being your profit.
An increase in demand for the company's stock
Investors in the company will drive the stock price up for Company A if they are more confident that Company A's cash flow will be closer to their expected value. Company A's stock price will be higher than Company B.
A good earnings report
Its annual profits decrease.
It's profits are increased.
Once a company goes public and its shares start trading on a stock exchange, its share price is determined by supply and demand in the market. If there is a high demand for its shares, the price will increase.
A company's stock price can show the following:The confidence and trust investors have on this companyThe profit making history of the companyThe probabilities of reaping capital appreciation on this stocketcRoughly: The higher a stocks price in the market when compared to its face value, the greater investors confidence in it.
Maintaining a high stock price allows a company to access the capital markets by issuing more stock at these higher prices and bringing in more cash for the company to use in its business. A high stock price is also a sign of investor confidence in the company, as well as a necessary requirement to maintain a stock exchange listing or bring in institutional investors as holders of the stock.
Watered stock is stock that is issued with a price that is much higher than the issuing company's assets. Watered stock can be stock that is overvalued due to excessive issuing or inflated accounting values.