from Amazon
Thursday, December 08, 2011
Lining up to buy value-less stock?
Apparently so. Packers were selling shares at 200$ a pop.
So what does $275 ($250 cost plus $25 handling fee) get a shareholder? Packers stock pays no dividends, can only be sold back to the team (for 2.5 cents), never appreciates in value and affords very limited voting rights.
This is like the Picasso theory, but worse. People buy Picasso not only for the intrinsic value of the art, but also for the potential to appreciate in value.
With the Packers, that stock certificate has no art value, and is precluded from appreciating in value. (Unless of course people sell it on the secondary market.)
Basically, it comes down to ownership: having something the other guy wants.
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By the way, where do the profits go if there’s no dividends? Is Andrew wrong about that?