What are catalysts?

Q What are company “catalysts” that some investing articles refer to?

— F.S., Summit Township, Michigan

A They’re events or developments that can give a stock’s value a big push — up or down. Even the expectation of a catalyst can affect a stock. Examples of catalysts include a surprisingly good (or bad) earnings report, a company’s entry into a big new market, new regulations that help (or hurt) business, the approval (or rejection) of a company’s new drug, the launch of a promising new product, an acquisition of another company, a legal victory or a housing boom.

Investors will often buy into a company based on expectations of one or more catalysts. For example, a company may be expected to open locations in China soon, or perhaps a restaurant chain will soon start serving breakfasts as well as lunch and dinner. It can be helpful when evaluating a company to learn about any catalysts that could eventually make shares surge.

Q Are there any lists of the companies that best serve all their stakeholders, such as employees and investors?

— R.N., Lewiston, Maine

A The “Forbes Just 100,” compiled annually with partner JUST Capital, polls thousands of people and ranks more than 900 major companies on how well they serve five groups of stakeholders: employees, communities, customers, shareholders and the environment. The top 12 companies in the 2021 list are: Microsoft, Nvidia, Apple, Intel, Alphabet, JPMorgan Chase, Salesforce.com, AT&T, Cisco Systems, Adobe, International Business Machines (IBM) and Bank of America. The top 100 in the list were found to have an average of 56% higher total shareholder return over the past five years, use 123% more green energy, and pay their median workers 18% more, among other things.