What happens to a stock's price after the company increases the amount of common stock?

Lets say they double the amount of common stock, will the price fall? Will the price fall soon after they announce it or will it fall when they issue it? Will it fall at all?|||It depends whether investors figure they will invest that money wisely to expand their business and increase earnings. Some people "sell the news" before they figure out what is going on. Doubling the stock can make many people bail out thinking their stock is worth half as much, but if the announcement was in preparation for a stock split, you could end up with twice as many shares.





In some cases the dip can be a buying opportunity. I was looking at a stock that had made a run up after excellent earnings. Then they announced that they were going to sell $100 million in convertible notes. It dropped like a rock back to where it was just before earnings, so I bought some. But the business has been all cash (no borrowed money until now), and $56 million will pay for a plant to be completed in August that will double their capacity. The rest may be used for acquisitions. It shook out some weak hands for a couple of days and now is moving back up.|||Oh yes it falls alright. Its called being diluted. Its exactly the same thing as inflation with currency. When Sirius kpt issuing more shares I got clobbered. The only way to offset that was to keep buying more shares. Everytime the stock had a small bounce back, Clayton would issue another public offering. The stock hit a low of 37 cents per share as a result of the dilution. Because I kept buying all the way down, when the stock went back to $5 a share I made alot because my cost average was $2 a share on 50,000 shares. They usually fall the second the announcement of the public offering is made. The stock usually falls to about the amount of the price that the stock is being offered at in the announcement in the public offering.|||by increasing the amount of common stock a company is looking to get an influx of capital, the effect on price is a complicated senario. if you are looking to invest for the long haul then buy some mut funds or etf's. dont think that you can pick stocks and become rich overnite, investing is very complicated, the brightest minds on the planet are wrong many times|||All things being equal if supply goes up and demand stays the same, price will fall. It would also depend on what they intend to do with the proceeds from the sale of stock. If they invest it above the company's cost of capital it could rise.|||Try %26lt;---http://earn-cash-today.com/stock


Good luck!