Warrant

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Warrant

A security entitling the holder to buy a proportionate amount of stock at some specified future date at a specified price, usually one higher than current market price. Warrants are traded as securities whose price reflects the value of the underlying stock. Corporations often bundle warrants with another class of security to enhance the marketability of the other class. Warrants are like call options, but with much longer time spans-sometimes years. And, warrants are offered by corporations, while exchange-traded call options are not issued by firms.

Warrant

A certificate, usually issued with a preferred stock, giving the holder the option of buying an underlying asset, in this case usually more stock, at a certain strike price. The strike price is usually higher than the market value of the underlying asset at the time of issue but lower than the expected market value at some point in the future. Some warrants expire a few years after issuance, but perpetual warrants can theoretically last forever. Unlike options, stock warrants are issued by companies during a round of financing, rather than by an individual investor or brokerage. Companies issue stock warrants to attract investors who might not otherwise be interested.

warrant

A security that permits its owner to purchase a specific number of shares of stock at a predetermined price. For example, a warrant may give an investor the right to purchase 5 shares of XYZ common stock at a price of $25 per share until October 1, 2007. Warrants usually originate as part of a new bond issue, but they trade separately after issuance. Warrants usually have limited lives. Their values are considerably more volatile than the values of the underlying stock. Thus, investment in warrants is not for the timid. Also called equity warrant, stock warrant, subscription warrant. See also debt warrant, perpetual warrant, usable bond.

Warrant.

Corporations may issue warrants that allow you to buy a company's stock at a fixed price during a specific period of time, often 10 or 15 years, though sometimes there is no expiration date.

Warrants are generally issued as an incentive to investors to accept bonds or preferred stocks that will be paying a lower rate of interest or dividends than would otherwise be paid.

How attractive the warrants are -- and so how effective they are as an incentive to purchase -- generally depends on the growth potential of the issuing company. The brighter the outlook, the more attractive the warrant becomes.

When a warrant is issued, the exercise price is above the current market price. For example, a warrant on a stock currently trading at $15 a share might guarantee you the right to buy the stock at $30 a share within the next 10 years. If the price goes above $30, you can exercise, or use, your warrant to purchase the stock, and either hold it in your portfolio or resell at a profit. If the price of the stock falls over the life of the warrant, however, the warrant becomes worthless.

Warrants are listed with a "wt" following the stock symbol and traded independently of the underlying stock. If you own warrants to purchase a stock at $30 a share that is currently trading for $40 a share, your warrants are theoretically be worth a minimum of $10 a share, or their intrinsic value.

warrant

a FINANCIAL SECURITY issued by a company to raise capital, which gives the holder the right to purchase SHARES in the company at some specified future date at a set price. Warrants are quoted on the STOCK MARKET and thus can be bought and sold in the same way as the issuing company's shares, usually at a much lower price. In essence a warrant is similar to convertible LOAN STOCK (but without interest payments) which can be converted into equity at the appointed time. The holder of a warrant forgoes current income in the hope of making a sizable capital gain on conversion.

Warrant

A certificate authorizing the holder to buy a corporation's stock at a specified price, either indefinitely or within a certain time. Warrants are different from rights in that they generally last longer, and the price at which the holder is entitled to buy the stock usually is more than the stock's market price when the warrant was issued.
References in periodicals archive ?
Rule 41(f)(2) Return on Warrant: Within 10 days after use of the device has ended, the officer executing the warrant must make the return to the magistrate judge specified in the warrant.
Centel provides a narrow opportunity for some warrants issued "in connection" with services.
The Ninth Circuit rejected the Tax Court's basic reasoning that at-the-money warrants have no value.
All search warrants, whether civil or criminal, need to be accompanied by a definitive description of the subject matter of the search.
We prioritize warrants based on the level of violence (of a perpetrator) and immediate threat they are to the public,'' said Los Angeles County sheriff's Deputy Jim Hellmold.
Audited financial statements as of February 1, 2007 reflecting receipt of the proceeds upon consummation of the initial public offering and the private sale of warrants will be issued by the Company and will be included as Exhibit 99.
The civilian personnel and volunteers fielded calls from citizens and persons who had outstanding warrants.
Acting under the assumption that the controlled corporation's sale of the warrants was a bargain sale, Taxpayer argued that the transaction should be recast under Sec.
All GFCI shareholders as of the Record Date will be issued a total of 20,000,000 three-year warrants converting on a 1:1 basis into Series B Preference Participating Drilling Shares of PDEI at a price of $.
Cases: Two court cases examined the deductibility of warrants issued to customers.
Specifically, the use of "sneak and peek" warrants by law enforcement officers has raised questions regarding compliance with the Fourth Amendment prohibition against unreasonable searches and the Rule 41 notice requirement.
The exercise of all of the E-7 and F-4 and C-3 warrants would result in the Company's receipt of up to $4,110,937 in additional cash proceeds.