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Technology Stocks : Ericsson overlook? -- Ignore unavailable to you. Want to Upgrade?

To: DMaA who wrote (1269)	1/29/1998 4:07:00 PM
From: JDN	Read Replies (2) \| Respond to of 5390

Dear David: There is a legal difference. For instance, in many jurisdictions (dont know Sweden) you can ONLY pay dividends out of Retained Earnings. By have a stock dividend that amount is transferred OUT of retained earnings for ever. Years ago stock dividends were more prevelant than stock splits. Course in those days the dividend might have been something like 3-10% and extra shares usually did not go down in value. Never seen a 100% stock dividend before. Since we tend to value stocks market wise based upon P/E, Revenue and Book Value per share for all intensive purposes you are probably right not much of a difference. I asked my broker why the stock went DOWN when the news is so good ie earnings over consensus, dividends up, 100% stock dividend etc etc. He said that somewhere the street has gotten the idea that earnings going forward would taper off to 25% which is why stock has dropped. JDN