I understand that a share of stock represents a share of ownership in a company. But if dividends are not paid, what is the actual value of that stock? Why does it have value? The company making more money does not flow to me because I own the stock. So is it basically just like owning a baseball card in that if the player (company) does well more people want to collect (own) their cards (stock) and this the price goes up?
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Imagine you have 10,000 shares in a company worth $50 each, giving you a $500,000 investment. Assume that the company does not pay dividends.
Over time, the stock increases in value. Eventually, it is $100 per share. So you sell 5,000 shares and get everything you invested back, $500,000, and still have $500,000 invested.
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