Companies don’t announce corporate actions arbitrarily. Each one serves a specific purpose rewarding shareholders, raising capital, improving stock liquidity, or restructuring the business.
Reward shareholders – Dividends distribute surplus profits directly to you. A bonus issue does the same without paying out cash.
Improve stock accessibility – When a share price gets too high, a stock split brings it down to a more affordable level without changing the company’s overall value.
Raise fresh capital – A rights issue lets the company raise money from existing shareholders before approaching outside investors.
Return excess cash – A buyback is how a company repurchases its own shares when it believes the stock is undervalued or has no better use for surplus funds.
Restructure the business – Mergers, spin-offs, and acquisitions are driven by long-term strategy — entering new markets, separating divisions, or unlocking value from a subsidiary.
Easy & quick
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