How does stock price and dividends reflect the value of the firm Term Paper

How does stock price and dividends reflect the value of the firm - Term Paper Example For example, if a corporation issues 100 shares in total, each share provides 1% ownership to the shareholder in the company. Share prices can increase or decrease based on the market conditions and the performances of the company. Corporations often keep certain percentage of its annual profits for future expansion of the company and pay certain percentage of the profits to its shareholders. The annual profit paid to the shareholders by the company is often referred as dividends. The amount of dividend supplied to the shareholders in a particular year depends on the profit achieved by the company in that particular year. In other words, when the company gets more profits, the shareholders get more dividends and vice versa. This paper analyses the importance of stock price and dividends with respect to the value of the firm. â€Å"A company's worth - its total value - is its market capitalization, and it is represented by the company's stock price. Market cap is equal to the stock p rice multiplied by the number of shares outstanding† (What is a company's worth, and who determines its stock price?, 2011). When the company grows or performs well, its share prices will increase whereas when the company underperforms, its share prices will decreases. When a company shows signs of growth, more demand will be created in the share market for its shares. Share purchasers often offer higher prices to the shares of growing companies and the shareholders who sell their share or stake in a growing company may get higher prices in the share market. â€Å"A company’s value for many investors is its ability to generate a satisfactory return over a long holding period. A number of things including financial strength, market dominance, growth potential, and so on, determines that value† (Little, 2011). For example, recently, the share value of many companies dropped drastically because of global financial crisis; however the share value of many other compan ies did not undergo many fluctuations as a result of the recent crisis. The companies which performed better in share market even in the crisis situations are generally perceived as better companies and the investors may invest more heavily in those shares. The share prices of better performing companies may not dip drastically even in unfavorable market conditions. In short, share price of a company is directly proportional to the growth of the company; when the company grows, the share prices will increase and when the company underperforms, share prices will decrease. Since dividend is a portion of annual profit made by a company, no company would be able to pay dividends to the shareholders when it underperforms. At the same time, it is not necessary that a company which is able to pay higher dividends is better than some other companies which are paying fewer dividends or no dividends at all. The value of the company can be better judged based on its operations or activities. O nly by generating more cash than it needs to finance its operating plan, should a company pay a dividend. Thus, for a company like Google with attractive growth opportunities, dividends are basically irrelevant to estimate its value. For mature companies, late in their life-cycle, paying dividends is a way to ensure management does not waste funds on silly projects, or build empires. Further, when a company is relatively mature, and it establishes a well-communicated dividend program, it attracts a particular investor

Anishinabe people and our homeland Research Paper

Anishinabe people and our homeland - Research Paper Example The truth is emphasized on ensuring that young people get well prepared to face new phase of their journey in all the steps of life. The basic learning experiences through the term involve several aspects. One of the aspects is enabling students to have a critical way of thinking. The teaching and learning goals may be very different (Audlin, 55). The learning experiences within this term ensure that an individual is capable of monitoring his or her own mind habits. The individual is also facilitated with basic intellectual capabilities as well as personal qualities. Learning through the term was fostered towards helping the students develop analysis capabilities where they can explain problems and develop an argument about same problem X using concept Y as depicted through the clan system of learning. Comprehension of concepts by students is evidenced by their position to analyze situation X and the ability to distinguish the concepts from common misconception (Trudeau, 34). The clan system insists on different outcomes at the end of a given term. For instance, by the end of this term, the clans system insists that all the students should have acquired basic analysis and be able to explain human behavior in terms of relationships among multiple factors (John, DeWitt, and Erwin 139). In a wider range, students should be able to understand how marginality is the broader learning category, linked to the understanding of nature (Trudeau, 54). The learning experiences are characterized by engaging activities that optimized every learner’s learning both in time and effectiveness. The term was also characterized by both hybrid learning and blended learning. Per se, the two terms mean a mix of online learning activities and quizzes with instructors-led teaching. Most of the instructors maintained a ‘coach on the side’ ways of teaching other than ‘sage on the stage’ methods. The learning activities were flexible