Why do people buy stocks without dividends or without earnings?

Answer 1

People who buy stocks without earnings are called speculators. They are betting that eventually the company will begin earning money and the price of the stock will rise in value. Normally, those stocks sell at very low prices, so if eventually they do begin to make money, the price rise in the stock can be significant.

Some companies do not pay dividend because they are making a very high return on capital and they believe that they can make more money for their investors by reinvesting the money in the business rather than paying it out in dividends. Other companies use the money to buy their stock back, frequently at inflated prices, such as Dell, which has thrown away billions by stock repurchases at inflated prices. The stockholder are now suffering the consequences.

Answer 2

You buy a stock without dividends because you want your investment to grow.

Everytime a dividend is paid, the stock price drops the same amount. The company also has to pay to have checks printed up and mailed out.

When you receive a dividend, it becomes taxable.

If your stock price just grows, there is no tax accessed on your gains until you sell the stock.

Someone might buy a stock without earnings, if future earnings are expected.

For example, a ski resort company that had no earnings over the summer, and the stock price is low now, and is expected to rise after winter earnings...

Answer 3

There are several reasons people buy stocks w/out dividends, for one dividends don't payout a whole lot unless you have a ton of shares, but when a stock moves a point in either direction you make or lose $1 a share, on your average 100 share lots for small time traders like myself, thats $100. In other words instead of trying to make money off dividends, i am going to buy and sell a stock as soon as the market moves the direction i am intending.
Alot of people buy a stock for the dividends and lose money the whole time they have it, even though they are pulling funds in from the yield, when they go to sell their stock it has moved so far against them that they have lost more than the dividends ever paid out.
dividends do tend to draw investors, but it is the companies fundamental values that are going to set the pace for the stocks quality in the long run.

Answer 4

People buy stocks without dividends or earning on the hope of future earnings. In the late 90's, neither yahoo, ebay, or amazon had earnings. All of the companies are now profitable, but most of the money was made in the 90's. People buy unprofitable companies on speculation of future profits. You can make a lot of money with this strategy if you make the right bets. You can lose everything if you make the wrong bets.

Answer 5

People buy a stock for two reason: to get a dividends, or to make a capital gain. A capital gain is when the price of a stock rises to more than what you paid for it.

Answer 6

Any finance course will tell you that the value of a business is simply the present value of future cash flows. In order to get to a level of comfort investing in a company with no dividends or no earnings you have to believe that the present value of cash flows that you forecast is greater than the price you have to pay.

Answer 7

If you buy "stocks" without dividends, it's not defined as "stock purchase"

Stock holders own parts of the business depends on their stocks.
They're legally obtian dividends from the company.

Answer 8

Because they anticipate there will be future earnings and dividends.

Answer 9

Cause they listened to a dumb a*s stock broker?

Answer 10

They're gambling. Everyone wants to hit the "big one".