Shareholders’ wealth maximization

Increasing the share price and increasing the dividend payment would be associated with the financial objective of shareholder wealth maximization.

Shareholder wealth is measured by the market value of shares, and an increase in share price directly contributes to increasing shareholder wealth. Dividend payment is another way to enhance shareholder wealth as it provides a direct return to shareholders.

Reported profit and earnings per share are not directly linked to shareholder wealth maximization. While they may be important indicators of a company’s financial performance, they do not necessarily translate into increased shareholder wealth.
The weighted average cost of capital (WACC) is a financial metric used to assess the cost of financing for a company. While it is an important consideration for financial decision-making, it is not directly associated with shareholder wealth maximization.