Rather than simply acting as an agent, an investment bank or other underwriters directly purchase securities from the issuer, usually at a discount to the market price, and then sells them to investors.
Archives
Bottom Line
After-tax earnings. Literally, the bottom line on an income statement (a.k.a. net income or profit).
Cash Dividend / Distribution
A dividend/distribution that is paid in cash.
Capitalization or Capital Structure
Total dollar amount of all money invested in a company, such as debt, preferred and common stock, contributed surplus and retained earnings of a company.
Consensus Estimate or Rating
The average of analysts individual earnings forecasts or buy/sell ratings.
Bought-Deal Underwriting
A type of underwriting where the brokerage firm acts as principal. The brokerage firm risks its own capital to purchase all of the securities to be issued. If the price of the securities decreases before the brokerage firm has had a chance to resell the securities to its clients, the firm absorbs the loss.
Capitalization Weighted Index
Largest companies have most influence on index price action.
Cash Flow
After tax income minus preferred dividends and general partner distributions plus depreciation, depletion, and amortization (Market Guide definition). See Operating Cash Flow and Free Cash Flow.
Bought Deal
Rather than simply acting as an agent, an investment bank or other underwriters directly purchase securities from the issuer, usually at a discount to the market price, and then sells them to investors.
Bounce
This occurs when a stock hits support in the form of an old high, a moving average, a trend line, or a combination of these, and moves up sharply. It is like dropping a ball onto a concrete sidewalk-the sidewalk is hard support and the ball bounces sharply. Not all support is strong enough for a bounce-we look for old tops (highs on the way up), breakout points (they act as resistance until the breakout-if the breakout is on good volume, it should act as support and give you a bounce). If money flow is good and the market is not tanking, we usually see a bounce off of this solid support.