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Not necessarily true - if the value gets low enough it'll get the boot from the NYSE.
by nicksergeant 11y ago
Not necessarily true - if the value gets low enough it'll get the boot from the NYSE.
- cordite 11y agoBut what does that mean to the company and its employees? I bring this up because of the stock market crash having such ridiculous effects from the great depression era. Though I may just be uneducated on what really happened.
- prewett 11y agoThe stock price need not matter at all to the company; the stock price is completely independent of the company. Once the shares are sold, the company no longer owns them, so whatever happens, happens, just like whenever you sell anything else. If a farmer sells some corn, and the price drops drastically afterwards, it makes no difference to the farmer. However, the owners of the company might get together and force the board of directors to do something, like fire the CEO. The CEO, who probably has a lot of compensation as stock or options, would like price to be higher, so he is likely to take actions to get the stock price higher. Such actions may or may not be wise, and may or may not be helpful for the company. Frequently they aren't...
- code4tee 11y ago"The stock price need not matter at all to the company" Tell that to the employees holding options. Those options are likely worthless if the stock price goes down.
- prewett 11y agoYou can do a reverse stock split to fix that problem.