If i buy shares in a company and then, at the end of the year, the company makes huge profits does some of that profit go to shareholders? or the only profit to make off of shares is if the price goes up and I sell the shares?
2007-12-11 09:11:27 · 13 answers · asked by ThE eNd 2 in Business & Finance ➔ Investing
All the answers that state you don't share in the profits other than from a dividend are correct. BUT the stock may be a great company, with earnings exceeding other companies in the same sector, have great management, great employee relations and the stock can still be a dog.
A case in point is Southwest Airlines (LUV) Unlike most airlines they have made money in all but one quarter since the stock came public.
I would work for Southwest, but I would not buy the stock.
It's five year trading history shows is from @12.00 to 19.50 with the last 52 week period being 12.89 to 16.96 this in one of the greatest runs in DOW history.
The five year history is from a chart. I didn't try to get exact quotes, the 52 week history is correct according the Scottrade.
2007-12-11 11:33:07 · answer #1 · answered by mason pearson 5 · 0⤊ 0⤋
It depends. A company can do three things with its profit: 1, it can hold it in reserve for a "rainy day"; 2, it can reinvest in the company; or 3, it can give the money to shareholders. Generallt in the first two ways the company is worth more so you will get money if you sell the stock, and the third way you will just plain get money, albeit less than the other two ways.
2007-12-11 09:19:25 · answer #2 · answered by baberuth 1 · 1⤊ 0⤋
If the company pays a dividend, then you share in the profits, otherwise you don't. You can find out if they pay a dividend easily: the information is in the newspaper and online. You'd be smart to invest in companies that pay a dividend; historically they make much more money for shareholders.
2007-12-11 09:14:35 · answer #3 · answered by Katherine W 7 · 4⤊ 0⤋
If the company makes profits, then you share is worth more than you originally purchased them for. The only way to get that money is to sell them. But they probably didn't make enough to be worth whatever selling fees would be imposed. Hold on to them for a while and watch the value go higher before you sell.
2007-12-11 09:15:12 · answer #4 · answered by Meghan 7 · 0⤊ 1⤋
The company may release cash dividents to
stockholders as of a cut-off date.
If a company makes huge profits, then the
value of their stocks will rise.
2007-12-11 10:49:48 · answer #5 · answered by Great Days 6 · 1⤊ 0⤋
About the only government grants I know of is in cities that want to rebuild their downtowns. A catering service wouldn't fit this model, because it won't drive business into downtown. But, I would start at city hall or your county courthouse. Forget state and federal grants. One person said that there weren't grants available to for-profit organizations ... this is incorrect. There are indeed grants available to for-profits, but they're all innovation grants (I've been successful in getting 2 for clients).
2016-04-08 21:18:20 · answer #6 · answered by ? 4 · 0⤊ 0⤋
I only know of two ways to make a profit on stocks. Either it pays a dividend or you sell it for more than you paid for it.
2007-12-11 09:22:49 · answer #7 · answered by politicallyincorrect 4 · 3⤊ 0⤋
This is not guaranteed unless the company's stock goes up in price and you sell when it is high. You could get dividends but it taks a long time for them to amount to much.
2007-12-11 09:15:33 · answer #8 · answered by Anonymous · 2⤊ 1⤋
Depends on weather the stock pays dividends or if you have to sell some when it goes up to get money out.
it can go either way.
2007-12-11 09:15:25 · answer #9 · answered by happygirl 6 · 0⤊ 1⤋
It depends upon whether or not they declare and pay dividends. Otherwise you will make your money on the increase in the value of the stock
2007-12-11 09:18:48 · answer #10 · answered by jwishz 7 · 2⤊ 0⤋