StockValuation - Stock Valuation Value of share of CS = PV...

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Stock Valuation Value of share of CS = PV of future cash flows =PV dividends + PV (future price) Rights of the common stockholder: Voting elect the board of directors proxy- allowing the current board of directors to voting in your place Pre-emptive right exist to allow current stockholders the right to maintain their percentage of ownership when new shares of stock are sold Liquidation Values if the company decides or is forced to go out of business you are last in line to receive anything Dividends just because you own common stock does not mean you are guaranteed a dividend Some firms may have different classes of commons stock Different reasons for why companies might have different types of shares different voting rights differences in price whether or not they pay dividends A shares B shares Preferred stock Considered a “hybrid” security with some of the following features: Cumulative

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