Stock Dividend (redirected from Accumulating Share)

Stock dividend

Payment of a corporate dividend in the form of stock rather than cash. The stock dividend may be additional shares in the company, or it may be shares in a subsidiary being spun off to shareholders. Stock dividends are often used to conserve cash needed to operate the business. Unlike a cash dividend, stock dividends are not taxed until sold.

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Stock Dividend

A dividend that is paid in stock or bonds rather than cash. A stock dividend may be declared when the company is cash poor and cannot afford a dividend otherwise. They are generally not considered desirable because one must pay capital gainstax on stock dividends, even though there is no cash gain for the shareholder. It is also called a scrip dividend. See also: Payment-in-kind bond.

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stock dividend

A dividend made up of shares of the paying firm's stock. A stock dividend is often used in place of or in addition to a cash dividend if the firm wishes to conserve cash. Unlike a cash dividend, a stock dividend is usually not taxable to the shareholder when it is received, but rather when it is sold. Stockholders who are supposed to receive a fractional share will often receive a check for the amount equal to the market value of the fractional share. Payment of a stock dividend is indicated in stock transaction tables in newspapers by the symbols b and t. See also scrip dividend.

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Stock Dividend

Additional shares of stock distributed to shareholders at no cost. The number of shares received are a percentage of the shares owned. The basis of the original shares is generally apportioned equally to the total shares owned after the distribution.