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Common stock listings may be used as a way for companies to increase their equity capital in exchange for dividend rights for shareowners. Listed common stock typically comes in the form of several stock classes in order for companies to remain in partial control of their stock voting rights. Non-voting stock may be issued as a separate class. [4]
Earnings per share (EPS) is the monetary value of earnings per outstanding share of common stock for a company during a defined period of time. It is a key measure of corporate profitability, focusing on the interests of the company's owners (shareholders), [1] and is commonly used to price stocks.
Common stock isn’t just common in name only; this type of stock is the one investors buy most often. It grants shareholders ownership rights, allows them to vote on important decisions such as ...
Equity accounts include common stock, paid-in capital, and retained earnings. Equity accounts can vary depending where an entity is domiciled as some jurisdictions require entities to keep various sub-classifications of equity in separate accounts. Revenue accounts are used to recognize revenue. Revenues are inflows or other enhancements of ...
This ratio shows investors the difference between the Class B’s market value and the book value of the stock. Similar to the P/E ratio, a P/B ratio is generally better if it is lower. A P/B ratio of 0.95, 1 or 1.1 shows that the stock is being traded at what its worth.
The gross profit ratio is equal to gross profit/revenue. This ratio shows a quick snapshot of expected revenue. Activity ratios are meant to show how well management is managing the company's resources. Two common activity ratios are accounts payable turnover and accounts receivable turnover.
The return on equity (ROE) is a measure of the profitability of a business in relation to its equity; [1] where: . ROE = Net Income / Average Shareholders' Equity [1] Thus, ROE is equal to a fiscal year's net income (after preferred stock dividends, before common stock dividends), divided by total equity (excluding preferred shares), expressed as a percentage.
Capital surplus, also called share premium, is an account which may appear on a corporation's balance sheet, as a component of shareholders' equity, which represents the amount the corporation raises on the issue of shares in excess of their par value (nominal value) of the shares (common stock).