The Basics of Google Alphabet
Google Alphabet is a parent company that oversees many different subsidiaries, including Google itself. The company is publicly traded, and there are two classes of stock: Class A and Class C. Both types of stock give investors a stake in the company, but they differ in some key ways.
What is Class A Stock?
Class A stock is the original type of Google stock. It comes with voting rights, which means that shareholders who own Class A stock can vote on company matters, such as electing board members or approving mergers and acquisitions. Class A stock also tends to have more value per share than Class C stock.
What is Class C Stock?
Class C stock was introduced in 2014, when Google reorganized itself under the Alphabet umbrella. Class C stock does not come with voting rights, which means that shareholders who own Class C stock cannot vote on company matters. However, Class C stock tends to be less expensive per share than Class A stock.
The Differences Between Class A and Class C Stock
There are several key differences between Class A and Class C stock.
Voting Rights
As mentioned earlier, Class A stock comes with voting rights, while Class C stock does not. This means that if you own Class A stock, you have a say in company matters. If you own Class C stock, you do not.
Price Per Share
Class A stock tends to have a higher price per share than Class C stock. This is because Class A stock comes with voting rights, which makes it more valuable.
Revenue Sharing
Both Class A and Class C stock are entitled to a share of Google’s revenue. However, Class A stock gets a larger share than Class C stock. This is because Class A stock is more valuable, so it gets a bigger piece of the pie.
Dividends
Google does not currently pay dividends on its stock. However, if the company were to start paying dividends in the future, Class A stock would likely receive a larger dividend per share than Class C stock.
Which Type of Stock is Right for You?
Deciding whether to invest in Class A or Class C stock depends on your investment goals and risk tolerance.
Investment Goals
If you’re interested in having a say in company matters, Class A stock may be the better choice for you. If you’re more interested in buying shares at a lower price, Class C stock may be the way to go.
Risk Tolerance
Class A stock tends to be more stable than Class C stock, but it also tends to have a lower potential for growth. Class C stock, on the other hand, is riskier but has a higher potential for growth.
The Bottom Line
Google Alphabet Class A vs C is a complex topic, but understanding the differences between the two types of stock is important if you’re considering investing in Google. By weighing the pros and cons of each type of stock, you can make an informed decision that aligns with your investment goals and risk tolerance.
