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Technology Stocks : Siebel Systems (SEBL) - strong buy?

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To: hueyone who wrote (5935)6/8/2002 10:51:33 AM
From: Mike Buckley  Read Replies (3) of 6974
 
Huey,

Can you please explain your phrase "inure to stockholders"?

You left out the operative word, "might." There are no guarantees.

To answer your question, the only way Siebel's success will inure to the benefit of stockholders who have no other stake in the company's success (as opposed to employees, employees in Siebel's value chain, etc. who do have other stakes in the company's success) is if the price of the stock goes up or if the company declares a dividend.

If I remember correctly (it's been a few months since I looked up the data), if all the stock options were exercised today there would be about 35% more shares of stock. Assuming there are no other changes in the company's fundamentals, in theory the stock price would drop by about 25% due to nothing other than the sudden stock dilution. It's nothing other than my personal way of looking at this stuff, but my thinking is that people who are concerned about a 25% change in the price of a stock shouldn't be investing in a company such as Siebel.

--Mike Buckley
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