Creative Labs (CREAF) Message Board

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Technology Stocks : Creative Labs (CREAF)

CREAF 0.448

-4.6%

Dec 17 12:59 PM EST

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To: Dennis G. who wrote (12699)	11/9/1998 2:09:00 AM
From: Dennis G.	Read Replies (1) of 13925

I'm still scratching my head, trying to figure out their reasoning behind this decision. Here are some possibilities: CREAF management must be convinced they will continue to make more money each year than they can spend on their own stock because of the 10% cap and what they want to spend on investments. Thus, the cash pile would just sit there. So they figure they would give some of it back. This could also be a back door way of effectively increasing the share buy back, since it is reasonable to assume that a percentage of that dividend money would be used by the owners to buy more CREAF shares. This gets a higher percentage of the stock in the hands of loyal supporters. This could also be a way of dealing with the negative psychology of the stock, especially with the institutions. There are lots of income funds out there and this stock will now pop up on their radar screens. And maybe also they are recognizing that they are not a go-go growth stock, and will try to establish themselves more as a strong cash generator. Sure is a shocker though. Dennis

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