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> Stock buybacks are one way that is theoretically equivalent to dividends. I replied elsewhere but this is the true value of something. What someone else is w
by CTDOCodebases 4y ago
> Stock buybacks are one way that is theoretically equivalent to dividends.
I replied elsewhere but this is the true value of something. What someone else is willing to pay for it.
> Also, amazon has underlying assets worth 420 billion
I always struggle with these valuations because like I said above the true value of something is what someone else will pay for it so I think they are an estimation at best.
I guess companies can be taken over and broken apart for their assets like private equity firms have become known for doing so these numbers do hold some weight. Though if liabilities grow to a level where the business files for bankruptcy these numbers are irrelevant to a shareholder since they are behind the creditors.
What no one mentioned here is voting rights. While the votes of small shareholders are largely inconsequential larger voters could on things that would benefit themselves financially so indirectly this can give value to shares.
- s1artibartfast 4y ago>I always struggle with these valuations because like I said above the true value of something is what someone else will pay for it so I think they are an estimation at best. This is true of anything. I own a used car, it is an asset, and has an estimated value that will only be verified/or disproven if I need to go through with selling it. If a company is liquidated, share holders are indeed behind creditors in getting paid out, so they would not get this full value. It seems that you understand it fully, what exactly is the struggle you are having?
- CTDOCodebases 4y ago> It seems that you understand it fully, what exactly is the struggle you are having? Just the truthfulness and validity of the valuations. The back and forth of these comments have helped clarify things. Thanks for your comments.