Which of the following corporate actions will affect the number of outstanding common shares of a company?

Issuing a stock dividend directly impacts the number of outstanding common shares because it involves distributing additional shares to existing shareholders based on their current holdings. When a company declares a stock dividend, it increases the total number of shares in circulation while maintaining the overall market value of the company. Each shareholder receives a proportionate amount of additional shares, which dilutes the earnings per share but does not affect the company's equity in terms of total value immediately.

This action differentiates itself from declaring cash dividends, which do not alter the share count since it involves cash payments rather than additional shares. Similarly, issuing convertible bonds can lead to changes in the outstanding shares in the future but does not affect the share count immediately upon issuance. Lastly, repurchasing common stock actually reduces the number of outstanding shares, as the company buys back its own shares. The specific context of a stock dividend clearly illustrates how this corporate action increases the number of shares outstanding.