Angus88 (Little Upsilon)
| Wednesday, July 16, 2008 - 10:36 am |
Public corps are a tricky process. Probably shouldn't try it until you know what your doing. Really market value is irrelevant for public corporations what really matters is the share price, if the share price is increasing or the number of shares is increasing then your doing good. I think because the cash levels of a public corporation are always relatively low may be a reason the market value can be low. The market value may be lower then a private equivalent company but will usually be more profitable then its private counterpart. The reason being is public corporations like to look after the share holders, and hence keeps the market price down.
That said public corporations can achieve a high market value. If its starting to loose profit the most likely cause is the market situation of its selling product and/or its raw materials. Set the profit sharing (dividends) of public corporations to 0%, you can't put money into them when times are tough so this means they will have the highest cash level possible for a rainy day. It things are going well they automatically pay out dividends the the shareholders so you don't need to worry about getting your cut. The rest has to do with the corporations settings (there plenty of advise in the help forum about this).