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Technology Stocks : Safeguard Scientifics SFE -- Ignore unavailable to you. Want to Upgrade?

To: KatayamaGorobei who wrote (1149)	2/24/1998 2:32:00 PM
From: still learning	Read Replies (1) \| Respond to of 4467

Adding to Ron's point, one of the advant of spinoffs is tax free treatment. Unlike dividends. This doesn't help refine the model. But I have an idea -- how about adding a multiplier effect (say 1.25X dividend based on 25% tax bracket)?

To: KatayamaGorobei who wrote (1149)	2/24/1998 4:15:00 PM
From: David Lawrence	Read Replies (1) \| Respond to of 4467

For your model to be more accurate, I feel you would have to take into consideration the average appreciation of the spinoffs over time. I think I disagree. The value of the rights offerings are the difference between the exercise price and the market value on the day of the offering (cash value). It's up to the owner whether they want to reinvest the "dividend" in the offered equity, or liquidate it and invest it elsewhere. The potential appreciation should not be taken into consideration, anymore than it would be if you were to take a cash dividend from another equity and invest it in a SFE offering.