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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host

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To: Boca_PETE who wrote (21960)3/27/2005 10:13:50 AM
From: Kirk ©   of 42834
 
"If you examine a graph of the market indexes from 1966-1982, you will see that the second and third cyclical bear markets made successive new lows with the lowest low made in the 1974-75 bear market. The next cyclical bear bottomed out at a higher low. With the last cyclical bear low made in late summer 1982 at DOW 777, the market finally launched."

What if you include dividends? Granted the losses to inflation were huge back then, but I recall those who had good dividend paying stocks didn't complain too much.

With our changed tax laws, companies repurchase shares with some funds that had gone to dividends in the past. AMAT is going to pay a 0.75% dividend and repurchase $4B shares which is roughly 14% of its market cap. This repurchase should help the price go up, all else being equal. Say they do it over 3 years. They could probably pay a 4 or 5% dividend instead and let the price go nowhere. I think the option game which favors share repurchase over dividends is a big reason we've seen dividends so small. If we change to restricted stock to reward insiders, then I'd not be surprised to see more dividends, since insiders would benefit as well as shareholders.


AMAT @ $16.63
Market Cap: $27.74B
P/E (ttm): 18.27
EPS (ttm): $0.91
Div & Yield: $0.12 (0.72%)
Total Cash per Share $3.84

Do you think Splinter waited until all of his 1¢ AMAT options were vested and used to buy AMAT stock before he announced the dividend?

K
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