Warning
Info
Warning
Info
LSDefine
Simple English definitions for legal terms
retired stock
Read a random definition: nonrefoulement
A quick definition of retired stock:
Retired stock is a type of stock that a company has bought back from its shareholders and either canceled or kept. It is also known as treasury stock. This means that the company has fewer shares available for trading, which can affect the value of the remaining shares. It is important for investors to understand the impact of retired stock on a company's financial health.A more thorough explanation:
Retired stock is a type of stock that a company has issued but then reacquired and either canceled or held. It is also known as treasury stock. Some states treat this stock as if it is authorized but unissued.
ABC Corporation issued 100 shares of common stock, but later reacquired 20 of those shares. These 20 shares are now considered retired stock or treasury stock.
This example illustrates how a company can buy back its own stock and hold it as treasury stock. This can be done for various reasons, such as to increase the value of remaining shares or to use the stock for employee compensation plans.