Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Naggrachi who wrote (61315)	8/27/1998 2:28:00 AM
From: Chuzzlewit	Respond to of 176387

Naggrachi, you already have a drip. That's what using excess cash flow for stock repurchase is. Only it's tax deferred. If Dell paid a cash dividend you would end up having to pay ordinary income taxes on the dividend. But when Dell repurchases shares you end up paying capital gains taxes on the pro-rata repurchase. Plus, if there were a cash dividend, taxes would be due quarterly, while with share repurchase taxes are due only when you sell the stock. TTFN, CTC

To: Naggrachi who wrote (61315)	8/27/1998 3:10:00 AM
From: PAL	Read Replies (1) \| Respond to of 176387

Shareholders are better off than receiving cash dividend. Dell is paying stock dividend, while that does not change the percentage of ownership, it does show that management is confident about the future of the company. You can already see that the stock split has done well for stock. Additionally, Dell uses 70% of its cash flow for stock repurchase, hence earnings per share and your percentage of company ownership are higher. The beauty those "dividend" are nontaxable as opposed to double taxation of cash dividend (i.e. cash dividend is distributed after tax by the company. When it is received by shareholders, it is taxed again on 1040. Hope that helps Paul

To: Naggrachi who wrote (61315)	8/27/1998 11:37:00 AM
From: jbn3	Respond to of 176387

Cash Dividend This question, whether DELL was considering paying a cash dividend, has been asked of the board the last two years at the annual meetings. The answer both times was "NO". I understand why you would like a DRIP. However, I think management is doing quite well right now. The beauty of stock over cash dividends is that the individual investors, you and I, determine for ourselves WHEN and IF we want to pay capital gains taxes, based on our individual financial situation. At least as important to me is that the individual investor option gives me the choice of turning it all into long-term gains. DELLflon, 3.