top button
Flag Notify
    Connect to us
      Site Registration

Site Registration

Why are corporations so concerned about their stock price?

+1 vote
105 views
Why are corporations so concerned about their stock price?
posted Jul 6, 2017 by Deepak Jangid

Share this question
Facebook Share Button Twitter Share Button LinkedIn Share Button

1 Answer

0 votes
  1. A company might want to guard against hostile takeover, and a high stock prices makes such a takeover more difficult.

  2. A company has a pool of stock not yet issued, and high prices for current stock might bode well for future issues of stock (though the new stock would dilute the pool and bring the price down).

  3. Stock price is an indicator of goodwill toward the company, so higher stock prices might mean better rates for loans and other types of investment.

answer Jul 6, 2017 by Amrita
...