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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 138.73+1.8%1:46 PM EST

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To: JGoren who wrote (110155)1/3/2002 5:45:14 PM
From: Art Bechhoefer  Read Replies (2) of 152472
 
Re: Dividends have good and bad aspects. When Intel began paying a small dividend, hundreds of pension funds whose rules prohibit investing in stocks that don't pay dividends began buying Intel, and the stock was one of the better performers. On the minus side, dividends are taxed twice, the first time as part of company profits and the second time as income to the individual investor. As long as the tax code allows this double taxation, it seems to me that dividends beyond a modest level are counterproductive. Instead, if a company really has enough cash to pay dividends, it also has enough cash to buy its shares, thereby increasing the earnings per share and potential gains subject to the capital gain preference. I would prefer this alternative or at least the Intel approach.

Art
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