Linked Questions

52
votes
6answers
25k views

How can a company use money from stock investors when they are constantly being bought and sold?

I am interested in the mechanisms which a company can use the money that investors give them when they buy a public stock since they are being bought and sold constantly. How can a company spend other ...
10
votes
4answers
520 views

From Facebook's perspective, was the fall in price after IPO actually an indication that it went well?

Please state if I'm incorrect but the whole point of a company doing a IPO is it wants to sell off a portion of itself in order to raise capital. So in an IPO, I presume a company would aim to sell ...
10
votes
5answers
6k views

What are the implications of a corporate stock repurchase or share buyback program?

Zynga's board recently announced their authorization of repurchasing up to $200M shares of Class A stock. What are the implications when a company repurchases their own stock? Some specific questions:...
9
votes
3answers
733 views

Avoiding sin stock: does it make a difference?

Until now I've avoided sin stock, such as tobacco, for the typical "moral reasons" (define those as you will), in particular in order to avoid raising their value as a company by creating demand (even ...
7
votes
2answers
5k views

How does the purchase of shares on the secondary market benefit the issuing company?

Purchasing common stock is often described as making an investment in the company. In exchange for this investment, you receive shares of the company's profits and, hopefully, you see some capital ...
5
votes
4answers
23k views

How does a high share price benefit a company when it is raising funds?

A company about to raise money desires a higher share price, because that will permit them to issue less shares for the amount of money they need. If the share price drops, they would need to ...
4
votes
6answers
9k views

What effect does a company's earnings have on the price of its stock?

I have been trying to figure out the answer to this question this afternoon, and it seems like most people are saying that supply/demand determines the price of a stock. It seems that earnings, which ...
3
votes
8answers
923 views

Is it accurate to say that if I was to trade something, my probability of success can't be worse than random?

I'm just trying to visualise the costs of trading. Say I set up an account to trade something (forex, stock, even bitcoin) and I was going to let a random generator determine when I should buy or sell ...
1
vote
1answer
60 views

How does a company earn money from going IPO and being on the stock exchange? [duplicate]

Please clarify if I understand the process of a company going IPO and selling shares on the stock market. A company goes IPO, and starts of with selling 1 million shares on an exchange. Sets the ...
1
vote
2answers
218 views

If a company has already IPO'ed and sold its shares, what is the incentive to keep making money? [closed]

If a company has already 'exited' with an IPO and sold its shares, what is the incentive to keep making money?
1
vote
2answers
76 views

Does trading (or abstaining from trading) a company's stock help or hurt the company?

Suppose that I am an environmentalist and I trade lots of green energy stocks and ETFs and I refuse to trade any that are based on coal and oil. By doing so, am I contributing to the success of the ...
1
vote
1answer
304 views

Why is it in a company’s interest to have high stock prices? [duplicate]

I understand that it is in the interest of a company to sell shares initially: It is a good way to get money to invest and grow. But once the shares are “out there”, why should the company care about ...
1
vote
1answer
150 views

Why public companies care how their stock price fluctuates? [duplicate]

After IPO, the socks are traded between 3rd parties (let's assume the company's employees don't own shares), so why should the company care what's their (perceived) value on the market? After the IPO, ...
0
votes
3answers
113 views

Noobie question about stocks [duplicate]

If almost everyone can earn money on stocks using good strategies. Why does a company shares profit or losses(or i do not know what the proper term is). What benefits company received? I came here ...
0
votes
3answers
110 views

Why do managements dislike low stock prices? [duplicate]

From reading various books, I am under the impression that managements usually dislike it when their stock price gets too low. I am not sure why. So my questions are: Given that the job of management ...

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