Individual Stocks

Selecting Individual Stocks

What is another strategy that a company might employ to make its stock attractive to potential investors and current shareholders?

Another strategy that companies might use to distinguish their stock from all others is by paying dividends or distributing the earnings of the company either on a regular quarterly basis or, in some cases, as a one-time event. Normally, a company announces the record date, which is the date that any shareholder must own stock prior to the payment of dividends, and distributes the dividend, usually shortly thereafter. When a company has amassed a lot of cash, it may pay out a special dividend to shareholders of record. Companies that regularly pay dividends tend to be large, predictable, and profitable companies, such as many companies listed in the Dow Jones Industrial Average.


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