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To: Dylan who wrote (30)1/9/1998 1:18:00 AM
From: William L. Oppenheim  Respond to of 100
 
Stock dividends (unless there is a cash dividend on a regular basis) are simply diluting the capital of the corp by the extra percentage of shares outstanding. A 10% stock dividend could easily reduce the value of each share by 10%. I would always prefer to have a cash dividend based on true earnings, over a share dividend. It is cheap to give away stock--doesn't cost the corp anythiing, and therefore isn't really worth anything. Think of it as a 10% stock split.