Corporations Stock Law and Legal Definition

The capital of corporations is also called stock; this is usually divided into shares of a definite value, as one hundred dollars, fifty dollars per share. The stock held by individuals in corporations is generally considered as personal property. Stocks may come in different types, such as common, Class A, and preferred A class of stock, such as Class A, Class B, etc., is category of stock where each stock share has the same voting rights, value, and characteristics. Preferred stock is a security representing a prior claim to common stock on the firm's earnings and assets. Preferred stockholders normally forgo voting rights and receive a fixed dividend that takes precedence over payment of dividends to common stockholders.