Shareholder Letter

AAA

DEFINITION of 'Shareholder Letter'

A shareholder letter is a letter written by a firm's top executives to its shareholders to provide a broad overview of the firm's operations throughout the year. The letter generally covers the firm's basic financial results, its current position in the market, and some of its future plans. The shareholder letter is generally written once per year and is included in the beginning of the firm's annual report.

INVESTOPEDIA EXPLAINS 'Shareholder Letter'

The shareholder letter can be a good first stop towards getting a broad overview of a firm that you are analyzing for investment. However, it is important to understand that the shareholder letter, along with many other parts of the annual report, is normally written in a way to put the company's operations in the best possible light. Investors will want to take the information in the shareholder letter with a grain of salt and be sure to delve more deeply into the firm's financial results and perform independent research on the company and its industry before drawing conclusions.

RELATED TERMS
  1. Shareholder

    Any person, company or other institution that owns at least one ...
  2. Chairman

    An executive elected by a company's board of directors that is ...
  3. Chief Executive Officer - CEO

    The highest ranking executive in a company whose main responsibilities ...
  4. Management Discussion and Analysis ...

    A section of a company's annual report in which management discusses ...
  5. Annual Report

    1. An annual publication that public corporations must provide ...
  6. Separation Of Powers

    An organizational structure in which responsibilities, authorities, ...
Related Articles
  1. Investing Basics

    Get Organized With An Investment Analysis Form

    Your research will be easy if you compile all the decision-making information you need.
  2. Markets

    How To Efficiently Read An Annual Report

    Learn how to read between the lines and decipher the actual condition of a company.
  3. Fundamental Analysis

    Financial Footnotes: Start Reading The Fine Print

    Find out what could be hidden in this often-overlooked part of the financial statements.
  4. Active Trading Fundamentals

    Evaluating A Company's Management

    Financial statements don't tell you everything about a company's health. Investigate the management behind the numbers!
  5. Investing Basics

    Knowing Your Rights As A Shareholder

    We delve into common stock owners' privileges and how to be vigilant in monitoring a company.
  6. Investing Basics

    Explaining Pro-Rata

    Pro-rata is a term meaning a fraction of a whole based on a relationship to the whole. Proportionate allocations are made pro-rata.
  7. Investing

    What are Preference Shares?

    Preference shares, also referred to as preferred shares, are equity shares that give the shareholders certain rights ahead of common shareholders. For instance, when the corporation declares ...
  8. Stock Analysis

    Intel Doesn't Need New Management

    Intel's purported manufacturing technology prowess has been completely squandered in the mobile arena, and the stock has been a disappointment.
  9. Stock Analysis

    Will Spinoffs Give American Capital A Pop?

    American Capital shareholders have long awaited a plan to spin off the company's investments from its prized asset-management business.
  10. Stock Analysis

    Will American Airlines Fall Back To Earth In 2015?

    The airline industry enjoys blockbuster profits, and American Airlines Group has been a key beneficiary of the favorable trends that have lifted stocks.

You May Also Like

Hot Definitions
  1. Hurdle Rate

    The minimum rate of return on a project or investment required by a manager or investor. In order to compensate for risk, ...
  2. Market Value

    The price an asset would fetch in the marketplace. Market value is also commonly used to refer to the market capitalization ...
  3. Preference Shares

    Company stock with dividends that are paid to shareholders before common stock dividends are paid out. In the event of a ...
  4. Accrued Interest

    1. A term used to describe an accrual accounting method when interest that is either payable or receivable has been recognized, ...
  5. Absorption Costing

    A managerial accounting cost method of expensing all costs associated with manufacturing a particular product. Absorption ...
  6. Currency Carry Trade

    A strategy in which an investor sells a certain currency with a relatively low interest rate and uses the funds to purchase ...
Trading Center