What determines a stock price? Is it the intrinsic value of a company or the public perception of such

- Value of a stock is determined by public perception of the company after initial public offering - Share price determined by public trading in the market - Question about dividend payments: Is it profit or does it affect share price? - Confusion about companies taking away from share price for dividends, thought only stock splits could do that

🚨 Reddit sentiment: mixed - Comments reflect a balanced discussion on the influence of intrinsic value and public perception on stock prices, with various viewpoints on market dynamics and investor behavior without a clear dominance of positive or negative sentiment. Summarized comments: - Stock prices can be influenced by company actions, market makers, trading algorithms, financial media, and underlying derivatives like options and swaps - Ben Graham's quote highlights that in the long term, stock prices trend toward a company's intrinsic value, while short-term prices can be driven by public perception - Top companies like NVIDIA and Meta maintain significant value due to quasi monopolies in their respective sectors - Stock pricing is influenced by a variety of factors including fundamentals, company promise, and investor opinions, highlighted by major investors like Warren Buffet - Public perception of a stock's future earnings, especially from large institutions, significantly influences stock prices, alongside company actions like buybacks and dividends - Dividends affect share prices, but mainstream finance theory equates asset value to the total cash it can generate adjusted for present value - The price of a stock is ultimately determined by bid and ask prices - Market participant positioning plays a significant role in determining stock prices - Dividend Discount Model suggests stock prices are the present value of future earnings (dividends) discounted at an expected risk rate - Speculation, especially by retail investors and hedge funds, can drive stock prices, often disconnected from intrinsic value - Price and intrinsic value are linked but not identical; stock price often follows market perceptions - Opinions on dividends vary, with some seeing them as reducing stock value while others believe they serve specific investor needs Stock tickers discussed: $NVDA, $META