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Old 09-08-2011, 01:53 PM
 
78,408 posts, read 60,593,823 times
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Let's look at a really simple example.

Let's say there are 10 shares worth $100 each and the company issues 10 more shares to expand the business in equivalent opportunities. In this example, since future returns will now be twice as much the shares would still be worth $100 each.

The company isn't just issuing 10 new shares, taking the $1000 and lighting it on fire....dropping the stocks value to $50 as the same previous dividends etc. are now being split 20 ways.

Now, if they are just giving them away "for free" that would be potentially another issue but if they are going out as part of compensation it's no different than paying them a cash bonus and thus having a lower dividend.
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Old 09-09-2011, 11:57 AM
 
Location: Malaysia
321 posts, read 533,919 times
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The companies should not be playing the numbers games to increase the value of the shares. In fact, if the core of the buisness is generating biz income , the intrinic value of the company shares should be coming more valuable as it would be reflected by the profits generated. With the profits generated , the share holders would be getting a higher dividen yields.
In short, who wouldnt wanna to invest with a company that pays high dividen that outperformed the bank rates or any other business? For all I know, I would be comfortable with it and would care if the dow is at 5,000 or 15,000, because I know very well i can sleep well for what I am investing which is the real thing of the CEO who knows how to make buisness profits instead of the sleight of hands of CFO who just know how to cook the numbers to inflate wall street figures.

IMHO, shares should be bought for its ability to perform with profits in the core business reflected by DY and not by the ingenious accountant who can cook up numbers.
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Old 09-09-2011, 12:48 PM
 
14,473 posts, read 20,652,743 times
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Does the OP have some good stock symbols to go by and show me where they see new shares being issued?
Are we talking about Dow and S&P companies or small startups?

AXTI appears to be a very small company, only 31 million shares.
Tell me where to go to see how they are issuing new shares.
Of course the smaller the company, the more affect, new shares will have.
A very small 3 million shares would be 10% of ATXI.

ATXI has been under $10 for the last 9 years.

If the OP, the question asker, a34dadsf, is speculating on these type stocks with low numbers of shares, then yes.
If you are talking about a growth company with 2 billion shares, then a share increase of 3 million is a drop in the bucket and does not affect shareholders in any meaningful way.

I'd like to see a list of stocks, that are names people have heard of, and where are you seeing their increase in shares.
Companies are going to reward employees with shares and options to buy shares.
That is a part of a companies success and can apply to all companies.

ATXI, if that is the lonely, only example someone has, show me where and how and when, they have issued new shares and for what reason?

I've seen companies sell new shares to raise funds. It's not as common as some make it appear.

Again, any list of examples, beside some stock with 38 million shares?
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Old 09-09-2011, 06:18 PM
 
14,473 posts, read 20,652,743 times
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Would like to be shown text, or documents, etc. where shares are being added to the outstanding or authorized, in such a way, as to cause shareholders to lose value.

Is ATXI the largest such company?
If so, it is not a concern for shareholders.
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