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Technology Stocks : Dell Technologies Inc.
DELL 131.29-1.4%3:27 PM EST
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To: Geoff Nunn who wrote (47391)6/12/1998 6:23:00 PM
From: Chuzzlewit  Read Replies (1) of 176387
 
Geoff, I'd look at it this way. When stocks are repurchased it decreases the number of shares o/s, therefore the eps increases and the price of the stock increases accordingly. But the stock price increase is a non-taxable event until the stock is sold. At that point the gain is converted from an ordinary dividend to a capital gain and is taxed at a lower rate.

Now, the buy back also supports employee options. But in this case the tax burden is shifted to the employee.

TTFN,
CTC
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