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One of the most commonly made mistakes is that people relate the dividends paid to the financial health of the company. Let me say that more dividends paid does not mean comapny is doing good and vice versa.
Generally, if the company pays less dividend because it requires that money for a new project which in turn will add to company growth. Thus stock price increases. If company does not have any new projects and still cut on dividends than stock price may go down.
In short, if company can grow faster than the markets than it should give less dividends. However, if company is growing slower than the markets than it should give more dividends so that people can invest in markets and earn more. If comapny does not follow this logic than its stock price reduces.
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∙ 13y ago
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Why does the value of a share of stock depend on dividends?
It really doesn't. A lot of high-tech companies that have great market capitalization, with fine products that lots of people like and buy, don't issue dividends at all.
You own 100 share of stocks which were bought at 30.00 per share and you receives dividends of 1.50 per share per year what would the yield on my purchase be?
If a person owns 100 shares of stock that were bought at 30.00 per share and receives dividends of 1.50 share per year what is the yield of his purchase
How does an investor realize earnings per share?
Awesome question, since it was Peter Lynch that said that stock prices, over time, follow earnings per share. How does the investor realize his investment? Only two ways: 1. Dividends paid by the company to shareholders 2. Price appreciation in the value of the share when sold to another buyer. The price of a share is set by the open market, but the "theoretical" value of the share price is the net present value of all future free cash flows, less debt. Since debt is easily measured, its the differing opinions on the value of future cash flows that causes fluctuation in market price.
What the meaning of stock price?
A share price is the price of a single share of a company's stock. Once the stock is purchased, the owner becomes a shareholder of the company that issued the share. The price is calculated by dividing the market capitalization by the total number of shares outstanding. When viewed over long periods, the share price is directly related to the earnings and dividends of the firm. Over short periods, especially for younger or smaller firms, the relationship between share price and dividends can be quite irrational.
What constitutes a constant growth stock and how it is value?
What constitutes a constant growth stock is a stock that has dividends that are expected to grow at a constant rate. The formula used to value a constant growth stock is determined by the estimated dividends that will be paid divided by the difference between the required rate of return and growth rate.
Why does the value of a share of stock depend on dividends?
It really doesn't. A lot of high-tech companies that have great market capitalization, with fine products that lots of people like and buy, don't issue dividends at all.
What is the formula used to figure out cost of equity?
The formula for cost of equity is equal to the growth rate of dividends added to the quotient of dividends per share divided by the current market value of stock.
Dividends per share is equal to dividends paid....?
Dividends paid divided by the toal number of shares outstanding.
What preference share is characterised by the property that should any dividends go unpaid those dividends must be paid before any future ordinary dividends?
cumulative preference share :)
What is the difference between Dividends per share and Earnings per share?
For my opinion Earning par share refer to a full dividend after expenses. But if we have prefered stock we need to seperate prefered stock dividends and take its balance for common stock dividends by:Earning per share = Balance after prefered stock dividends / Number of shareOne more Dividends per share refer to balance for common stcok after we seperate balance after prefered stock dividends to both side, common stockdividends and retained earning.Dividends per share = Common stock dividends / Number of shareis that right? if another have any ideas please let me know.Thanks.!
Does the value of a share of stock depend on how long you expect to keep it?
yes
What is a share of profits distributed to stockholders?
dividends
Stockholder's share of a company's profits?
dividends
What is a stockholder's share of a company's profits?
Dividends
What is a share of a companys profit?
The stockholder's share of a company's profits are called dividends.
Is v greater than 10?
The answer will depend on the value of v - which you have chosen not to share.
What is a stockholders share of a company profit?
The stockholder's share of a company's profits are called dividends.
