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> Should these companies be valued the same By who? Public money is looking for dividends (profits) not growth?
by ignoramous 4mo ago
> Should these companies be valued the same
By who? Public money is looking for dividends (profits) not growth?
- bhelkey 4mo agoIf indeed the public is looking for dividends, why is Amazon, a company that has never paid a dividend, such a valuable company? Amazon has ~10 Billion outstanding shares and the current market price for one of those shares is ~$240. If folks only care about dividends, why would anyone buy an Amazon share at that price?
- ignoramous 4mo ago> why is Amazon, a company that has never paid a dividend, such a valuable company? You'd hope every publicly-traded long term minded company operates the same way Amazon does. Reinvestment of money they themselves earn in "growth" and still retain a trickle in profits.
- margalabargala 4mo agoPublic money is looking for profits. Dividends are one way to get there. A better way to get to larger profits is selling the stock after it gets much more valuable. In the example above the growing company has a good chance of being worth much more a few years later, and that increases the value.