Creative Labs (CREAF) Message Board

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Technology Stocks : Creative Labs (CREAF)

CREAF 0.411

+11.2%

Dec 8 12:12 PM EST

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To: BZOOKA who wrote (11441)	5/27/1998 11:27:00 PM
From: mozek	Read Replies (1) of 13925

Maybe someone can help. Creative has a miniscule PE ratio, lots of cash, and they can't buy back their stock. Why would they buy Silicon Engineering with stock???? Usually a company pays with stock over cash when it thinks the stock is fairly or overvalued. If the company has a higher PE ratio, which wouldn't be hard, a stock purchase raises CREAF's PE ratio. A cash purchase does the opposite and effectively acts as a surrogate for a stock buyback of their own. This doesn't make sense to me. Does anyone have any insight? I don't have a position in CREAF. Had one last year, but I sold and haven't reentered yet. Thanks, Mike

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