this post was submitted on 14 Oct 2023
757 points (99.0% liked)
Technology
59207 readers
3158 users here now
This is a most excellent place for technology news and articles.
Our Rules
- Follow the lemmy.world rules.
- Only tech related content.
- Be excellent to each another!
- Mod approved content bots can post up to 10 articles per day.
- Threads asking for personal tech support may be deleted.
- Politics threads may be removed.
- No memes allowed as posts, OK to post as comments.
- Only approved bots from the list below, to ask if your bot can be added please contact us.
- Check for duplicates before posting, duplicates may be removed
Approved Bots
founded 1 year ago
MODERATORS
you are viewing a single comment's thread
view the rest of the comments
view the rest of the comments
Take two is three times smaller via market cap and Capcom is 8 times smaller, just saying looking at stock price alone doesn't tell the full picture.
Activision has also done multiple stock splits over the last 30 years.
Stock price charts account for all splits/reverse splits, so it wouldn't be a factor when comparing price over time.
I agree with the first point though. Even just performing slightly below the market with such a massive company would make Kotick very desireable as a new CEO, unfortunately. Maybe some corps would not be fine with his reputation, but I doubt he will struggle to find a position in a new board room.
The stock price itself does account for it in the charts, but it doesn't speak to the market cap aspect.
The charts are in percent, not dollars. It doesn’t matter that Capcom is 8 times smaller if investing $1 in it still yields a higher return on investment.
Also, Take Two may be smaller, but… Grand Theft Auto.
Not true, because of stock splits
Also all I'm looking at is market cap, it doesn't matter what games you like from them lol
Nah because you're fundamentally misunderstanding what "investing 1 million" would mean after a stock splits happens.
I do this shit for a living lol
Also profit doesn't directly translate to a higher stock price, as there are various other aspects (rational and not rational) that can move a stock up or down.
Here's an example, using your invested a million starting point, for simplicity we'll say we bought in 1 share for $1 so we have 1m shares.
Price rises to $2, our position is now worth 2m, simple.
Stock does a 1:4 split, we now have 4m shares with a purchase price adjusted to $0.25 that is now trading at only $0.50 but our position is still worth $2m
Stock moves back up to $2 after some time, our position is now worth $8m
Another stock split 1:2 this time, putting us at 8m shares and stock price is back at $1, still $8m position.
Stock moves back up to $2 after some time, our position is now at $16m
On a chart it won't look like the stock has increased all that much, yes they do get adjusted for splits as you mentioned but that alone still doesn't really speak to how stock splits effect your gain/loss when held since they continue to grow at a faster rate, higher shares outstanding generally means harder stock price to move since it effects the market cap so much more.
I understand stock splits completely, and I now see that you do too.
Looking at the charts again, they do not measure what I initially thought they did. I thought each line represented profit (investor profit, not company profit) as a percentage of the original investment. I did not realize that the lines to not meet at 0% at the earliest time all three stocks could be purchased on the market.