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

To: Ian@SI who wrote (148044)	11/26/1999 3:50:00 PM
From: Sr K	Read Replies (1) \| Respond to of 176387

Re: Buybacks The most tax efficient way to return capital to the owners. The law on short-term swing trading by insiders provides for the return of the gain to the company. So if Dell sells puts that expire worthless, the gain is already in the company. Dell sells long-term puts and buys long-term paired calls as I recall, and from the size they are privately placed, not the OCC variety. The other side of these transactions may take positions in standardized options to offset their risk and exposure. I lurked at Dell.com and noticed that the Inspiron 7500 is base priced with 32 MB RAM, and Dell's prices for adding more are quite fat. If they're holding that price structure, and stretching deliveries, as commented here earlier, they might have expanding margins. Also, as I left the site, there's a new pop-up window that smartly asks Why, and gives 8 or so multiple choices (want to know shipping and handling, want to shop some more - I went to GigaBuys) and a box to fill in why you are leaving without buying. It seems to me the difficulty getting through for a few days had to do with a conscious effort to upgrade the site and the hardware to handle the increasing volume, all positives that some here thought was negative.

To: Ian@SI who wrote (148044)	11/26/1999 6:23:00 PM
From: Chuzzlewit	Read Replies (1) \| Respond to of 176387

Ian, an distinction, as I see it, is that although dividends are taxed, which decreases their efficiency, they are paid on a date known in advance. That provides a level playing field. But the timing of stock repurchase programs is at the discretion of management. If they are accomplished at regular intervals, without regard to the price of the stock at the time of the transaction, I have no problem -- they would simply act like a tax efficient DRIP. But if they are triggered by externalities such as the price of the stock, or the time of exercise of employee stock options, then I do have major problems. Remember, the vast bulk of stock options result in their exercise and immediate sale. I believe that the only legitimate reasons for engaging in stock transactions should be altering the financial structure of the company for long-range reasons, and the return of unneeded capital to investors. All too often buybacks are used to mask falling earnings per share. TTFN, CTC