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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (4655)8/15/1998 9:25:00 AM
From: Ron Bower  Read Replies (2) of 78628
 
Paul,

You don't feel there will be a trend towards dividend stocks as the baby boomers retire? Less than 17 years.

It seems to me that the trend would be to income producing stocks and it will pressure corps to change policy from buybacks to paying dividends. IMO most corps buyback primarily to benefit insiders (stock options) and don't pay dividends because wealthier insiders don't want the taxes.

IMO the ideal company is growing and paying a percentage of income out in dividends. Over a period of years, you get a cash return on investment, price appreciation from the growth, and increasing dividends. The growth of this type of stock is usually less than a non-dividend paying stock because the company isn't keeping the capital, but the overall return is equivalent and the risk lower.

JMHO,
Ron
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