What do you call a stock that pays no dividends?

A stock that pays no dividends is typically referred to as a growth stock. Growth stocks represent shares in companies that are expected to grow at an above-average rate compared to other companies in the market. These companies often reinvest their earnings back into the business instead of paying them out as dividends, allowing them to expand and innovate, which can potentially lead to higher share prices over time.

Investors in growth stocks are usually looking for capital appreciation rather than immediate income through dividends. This aligns with the concept of investing in stocks for long-term gains rather than short-term cash flow. Growth stocks are often found in sectors such as technology or biotechnology, where the potential for rapid growth is substantial.

The other types of stocks mentioned in the options, like preferred stocks, value stocks, and income stocks, generally provide some form of dividend payment or are based on stable, established companies that return profits to shareholders. In contrast, growth stocks prioritize reinvestment over immediate payouts, making them a distinct category focused on long-term appreciation.