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NEW YORK (AP) - Cash may be considered king in the corporate world, but just having lots of it doesn't mean that a company will necessarily reign in investors' eyes.
It turns out that history shows a significant correlation between how a company builds and uses its cash holdings and the future return of that company's stock price. Investors tend to reward share buybacks, dividends and debt repayments, but are less enthusiastic about capital spending, research and development and acquisitions, at least one new study suggests.
Of course, investing in the business could help a company build for the future, which could eventually boost its stock price. That may very well be true in theory, but it might not hold up in practice.
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