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gibson256

02/11/18 4:31 PM

#30324 RE: Dingster #30323

This is true...but if they issue more shares, they will make money for those shares. Dilution intrinsically has no effect on the value of the company. If they sell 50 million shares at $.30 per share, yes your ownership will be cut in half...but you’ll own the same value because the company will then have that much more cash.
It depends how the ceo allocates the capital. He can use it to create more value or he can pay himself a big bonus (or waste it on bad deals).
Shareholders are at the mercy of the execs.