Shareholders Issues Flashcards
What is a shareholder?
One of the owner of a limited company who invests capital in return for decision making power, and a share of a company’s profits.
What is ordinary share capital?
A proportion of the ownership of a business that entitles the owner to a decision - making power and a share of the company’s profits.
Does a company have to buy back a share?
A share is permanent - the company does not have to buy back from the shareholders if they wish to sell it.
Are dividend payments guaranteed?
Dividend payments are not guaranteed
What can a share holder do to make the final decision in a company?
One share entitles the owner to one vote. Therefore if one investor owns 51% of shares this is known as a controlling stake.
Basically they have to own 51% of the shares.
What is market capitalisation?
The total value of issued shares in a public limited company
What is the formula for market capitalisation?
Total number of shares issued X the current share price
What is a dividend?
A share of a company profits issued to shareholders on an usually on an annual basis
Does a company have to pay out dividends?
The company may not pay out dividends if they see it to be more profitable for the company in the long run.
