BLW 1002 Lecture Notes - Lecture 4: Stock Split, Preferred Stock, Share Repurchase
20 Sep 2016
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Stockholder = shareholder = equity holder = part-owner of corporation. What are the different types of stocks: common stock. Most basic, fundamental form of ownership in a corporation. Shareholders have a right to vote, have a piece of ownership, and have a right to dividends. Dividends are not guaranteed they are paid out only if the company makes enough profit to give out. Additionally, not all corporations give out dividends; some use the money instead for research: preferred stock. If dividends are not paid out a certain year because the company doesn"t make enough profit, then the preferred stock shareholders will not get a dividend for that year: cumulative preferred stock. Any dividend not paid in particular year turns over to next year and accumulates. Stockholders will eventually receive cumulative amount dividends once business has enough profits. Most corporations have only one class of shareholders in which 1 share = 1 vote.
