Chagee owner a very clever person who knew how to transfer massive wealth into his own wallet at the expenses of shareholders
It was quite an eye opener for me to see Chagee owner transfering massive wealth into his own wallet at the expense of shareholders
With 2 consecutive quarters earnings reports declining in profits and EPS, giving out a one time special dividend of 0.92 USD per share might look good on paper
But it actually benefits the owner who held more than 65 millions shares more rather than the shareholders as the company should instead use the cash to conduct shares buyback of Chagee rather than giving out dividends which mainly benefits Chagee owner and the top executives of Chagee
It somehows give me an answer on the reason why Chagee owner did not sell away part of his shares after the lockup period ends, giving out such high special one time dividend is actually another reverse way of selling shares to put money into the owner own pocket
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MrYuan : He really didn't participate; it's as if you know him.
ScorpioRebelliousTV OP MrYuan : The company's financial reports for two consecutive quarters have been disappointing. The company should use its existing cash to repurchase its shares to stabilize the stock price rather than distribute a one-time special high dividend.
The company's founder holds 65.27 million shares, and this dividend payout will allow him to cash out up to USD 60 million.
Perhaps Chagee’s loyal supporters will blindly stand by the company no matter what happens, but I feel that the company’s founder is more concerned about his own wallet.
Falling angel : I found it quite odd when I saw the dividend. Which company distributes dividends right after going public? The purpose of an IPO is to raise capital, and raising capital is for business expansion. Yet, this company is issuing a dividend, returning money to shareholders—a very unusual move. Sigh, I’m somewhat disappointed. I really liked drinking their products.![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
pantsB : im with you on this one. while it is true that the company is very cash rich, the purpose of their recent ipo should be to deploy their funds in such a way that benefits the company. this dividend payout not only doesn't grow the company, it draws on their cash reserves at a time where the company is facing strong competition.
MrYuan ScorpioRebelliousTV OP : He personally does not lack funds, as dividends from previous years were sufficient. The main purpose is to distribute among the dozens of entrepreneurial partners, reducing their stock sell-offs when prices are low.