As I understand it, once a company raises, say $5 billion in an IPO, the shares are sold and they get the money.
The shares are already with the public now. Why is it so important for public companies to grow their share price further every quarter? Why not focus only on the final profit margins?
In: Economics
Because those shareholders are the owners of the business. They can hire and fire the executive team through the board, which they appoint. Shareholders want to make money on their investment, and that requires he stock price to increase.
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