COPYRIGHT © 2008 KIRBY COCHRAN. ALL RIGHTS RESERVED
1. Stock Price Shepherds
It starts with the shareholders.Shareholders drive the value of the company. However, it is myobservation that most Senior
how their shareholders can affect thestock price of their companies. Somemanagers are even contemptuoustoward shareholders, looking at their responsibilities to the shareholders asan unnecessary burden, an annoyancethat interferes with the running of the business.When management teams dounderstand how shareholders drivethe value of the company
(after all this isn’t something they could pick up in business school or from
want to know more about their shareholders. They have spent years
of their industry and the competitivelandscape. They go to great lengthsto understand the customers who buytheir products and services and howto manage their production and salesorganizations.In contrast, they may have beenonly passively involved in gettingand retaining their shareholders.Unfortunately these management
as just another fundraising effort tofuel their goals for the business andgive little thought to the obligationsand responsibility which comes withhaving a base of shareholders.
shareholder value, they ought torealize that they have becomestewards of two sides of the business(generating sales/earnings
increasing their shareholder value
These two sides are just like a Yinand Yang of growth and success–twoinseparable halves that require equalnurturing for the company to flourish.
better understand their shareholders;the under-served and neglectedside of their business. They needto know what threatens and whatencourages investors to buy and selltheir stock. One absolute necessity for management teams is to understandthe psychology of their investors.