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Technology Stocks : Dell Technologies Inc.

DELL 138.22

-1.6%

3:59 PM EST

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To: TCBinAugusta who wrote (82674)	11/29/1998 3:26:00 PM
From: Chuzzlewit	of 176387

TCB, repurchasing shares seems to be one of the most misunderstood phenomena in finance. The fact is that repurchasing shares is really only a tax-advantaged form of a DRIP. The result is actually a drop in total capitalized value, and has no effect on shareholder value (other than the difference between capital gains and ordinary income on the "dividend"). It has the effect of increasing P/E if you look at historic earnings divided by current shares o/s. Some of the shareholder excitement is generated by the false illusion that stock repurchases necessarily increases shareholder value. TTFN, CTC

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