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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: GVTucker who wrote (138721)	8/9/1999 12:06:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 176387

GV, Can you give us the gist of the article? ***** In this Sunday's NY Times business section there was a letter to the editor from someone who is head of a shareholders' rights organization. He claimed that there are some downsides to stock repurchase plans. He claims that share repurchase benefits only the few who sell their shares and the shareholders would be better off if the company either dividended the cash or invested in expanding or improving operations. The author is wrong on several counts. First, a share buy back is a tax-advantaged dividend (a point I have repeatedly demonstrated on this thread). Second, the value of each share of remaining stock increases, all other things being equal. Third, investing the cash makes sense only if the investment will generate returns in excess of the WACC. I would be critical of companies sitting on large amounts of cash and doing nothing with it. Microsoft comes to mind (around $42 BB !!). TTFN, CTC