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Technology Stocks : Winstar Comm. (WCII)

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To: Jason Cogan who wrote (5689)5/3/1998 9:09:00 PM
From: Bernard Levy  Read Replies (1) of 12468
 
Dividends have become a very tax inefficient way of
returning value to shareholders, since they are taxed
as ordinary income. On the other hand, share buybacks
raise the stock price, and the corresponding appreciation
can then be captured as long term capital gains,
which are only taxed at 20% (may be less in the future
if we can put a real tax reformer in the White House).

Thus, I hope that WCII will not distribute dividends,
but will use its cash flow either to expand its business
or to buy back its shares.
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