Corporation Types Summary

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Type
Suited for which type
of investor 

Expansion
opportunities

Competition
Does what with profits
Relates to
Watch out for
Defensive Conservative, who wants to be proactive when recession appears imminent Average Average Usually pays out enough for substantial dividends with some kept to grow business The best may also be blue chips Some things thought to be defensive may not be, such as fuel and prescription meds 
Income Conservative, retirees who need recurring cash payments and who can’t afford big losses Limited Limited Pays most out as dividends Opposite of growth Corporations with dividend yields that are very high, as they may be about to cut the dividend
 Growth Aggressive, younger investors who can make  up for losses if they occur   Tremendous Especially fierce Keeps all or nearly all for growing the business Opposite of income Not all corporations can dominate huge new markets. Shares price of those which fail can drop dramatically
Blue chip Average risk taker who wants some income but also some growth potential  Average  Average At least a minimal dividend payout but can be significant enough to compete with income corporations Can also be defensive. Opposite of penny A dying breed as it’s harder than ever to stay on top, evidenced by many meltdowns among former blue chips
Value Conservative, patient investor who wants to reduce risk of downward move in share price Average Average

 

Varies from no dividend payout to  reasonable dividend

“Value trap”, as the share prices of some doomed corporation pause on the way down
Cyclical More involved, one who wants to profit from state and direction of the economy Good during economic expansions, poor during recessions  Average

Varies from no dividend payout to  reasonable dividend

Opposite of counter-cyclical. Difficult to also be a blue chip Prolonged recessions and the cutting of dividends to help them survive 
Counter-cyclical Alert “go anywhere” investors who want their investments to be on offense at all times Poor during broad economic expansions, good during recessions Average

Varies from no dividend payout to  reasonable dividend

 

Opposite of cyclical Governments which may act to limit practices they see as abusive to consumers
Penny Gamblers Tremendous Varies

If it has profit, keeps all of it to grow business

Opposite of blue chip “pump and dump” schemes, where fake positive news and buzz temporarily drive share price higher

 

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2017-08-21T07:03:53+00:00