With public corporations that issue stock but do not pay dividends, when the company makes profits, besides?

Question

operating costs and acquisitions, what happens to the profits? If I own stock that doesn't pay dividends and the company makes great profits,what difference does it make to the stockholder as he doesn't share in them. Perhaps the stock price will gain on the public perception that they own a part of something valuable, but it isn't like really owning a part of the company as one doesn't benefit from the profits. If by owning stock, it meant I really owned part of the company, I would take the profits and put them in my bank account ? What does happen to the excess profits, who gets that money?

Answer 1

The profits are retained by the company, for whatever reason the board decides they are needed. Could be to pay down debt, fund expansion and so on.

Answer 2

The line item is actually called "retained earnings." The profits stay within the organization as a capital account (equity). Many organizations that are in growth mode will not pay dividends as they need to re-invest in their own company to support its future growth (and accordingly, increase shareholder value).