book equity
book equity. The percentage of a corporation’s book value allocated to a particular class of stock. Cf. BOOK VALUE; MARKET EQUITY.
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equity accounting method
A method of accounting for long-term investment in common stock based on acqui-sition cost, investor income, net losses, and dividends.
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equity security
A security representing an ownership interest in a corporation, such as a share of stock, rather than a debt interest, such as a bond; any stock or similar security, or any security that is convertible into stock or similar security or carrying a warrant or right to subscribe to or purchase stock or a similar
subscribed stock
A stockholder’s equity account showing the capital that will be contributed when the subscription price is collected. See SUBSCRIPTION (2). [Cases: Corporations 88.]
earnings per share
earnings per share. Corporations. A measure of corporate value by which the corporation’s net income is divided by the number of outstanding shares of common stock. • Investors benefit from calculating a corporation’s earnings per share, because it helps the investor determine the fair market value of the corporation’s stock. — Abbr. EPS. fully diluted
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redemption
redemption, n. 1. The act or an instance of reclaiming or regaining possession by paying a specific price. [Cases: Secured Transactions 241. C.J.S. Secured Transactions § 184.] 2. Bankruptcy. A debtor’s right to repurchase property from a buyer who obtained the property at a forced sale initiated by a creditor. [Cases: Bankruptcy 3034. C.J.S. Bankruptcy
recapitalization
recapitalization, n. An adjustment or recasting of a corporation’s capital structure — that is, its stocks, bonds, or other securities — through amendment of the articles of incorporation or merger with a parent or subsidiary. • An example of recapitalization is the elimination of unpaid preferred dividends and the creation of a new class of
soft dollars
soft dollars. 1. Securities. The credits that brokers give their clients in return for the clients’ stock-trading business. 2. The portion of an equity investment that is tax-deductible in the first year. Cf. HARD DOLLARS.
poison pill
poison pill. A corporation’s defense against an unwanted takeover bid whereby shareholders are granted the right to acquire equity or debt securities at a favorable price to increase the bidder’s acquisition costs. — Often shortened to pill. See TAKEOVER DEFENSE. Cf. PORCUPINE PROVISION. [Cases: Corporations 310(1). C.J.S. Corporations §§ 475, 477–484, 487–489.] “Another recent tactic