I think that's kind of a common misconception where investors might think that good news just automatically means that it will go up. I'm curious if you can talk about share repurchases and dividends and how those impact a company's stock price. Sure. Let's start with the easy one, the dividends. A dividend is when a company takes a portion of its profits and gives those directly to the shareholders of that company. The reason that companies do that is pretty apparent. It allows the investors in that company to realize a cash gain on holding that company's stock.
IN THIS EPISODE, YOU’LL LEARN:
02:52 - What is a stock and why do stocks have value?
04:40 - The main factors that increase a company’s value over time.
05:48 - What causes stock prices to move up and down and why this sometimes has nothing to do with company value.
07:51 - How share repurchases and dividends impact a company’s stock price and company value.
11:26 - Why the P/E can look inflated based on the market cycle, accrual accounting choices, a company's equity investments, etc.
14:04 - What factors influence a company’s reported earnings that you may need to adjust for when valuing a company.
21:06 - An overview of GAAP and non-GAAP accounting, what are the differences between the two, and which should investors focus on for valuation analysis.
24:44 - What are the main ways that earnings can be manipulated based on accounting assumptions used?
46:27 - What are some accounting warning signs to look out for that might suggest companies might be cooking their books?
49:54 - What discrepancies to look for in a company’s income statement vs cash flow statements.
And much, much more!
*Disclaimer: Slight timestamp discrepancies may occur due to podcast platform differences.
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