02-24-2014, 09:51 AM
(This post was last modified: 02-24-2014, 09:53 AM by Dividend Watcher.)
Seeking Alpha author "Safraner Investment" wrote another puff piece on this same topic last Thursday. (Can't believe I wasted my penny on reading it.)
The topic is a dead argument as far I'm concerned. Most of the time the thesis is based on the balance sheet alone without taking into account the income (P&L) and cash flow statements. Who, afterall, would go to work for a company and not expect a paycheck? You're just investing your labor rather than your cash. Do you not expect a return? Similarly, you invest your money in a company, do you not expect a return?
Yes, I know that you're not directly giving the company your cash when buying a stock on the open market but if you're going to look at it dogmatically, someone did when that stock was issued and that "someone" is just transferring that claim on the company's assets to you. In effect, it's as if you really gave the cash to the company just xx years later.
We've gone over this topic so much it's really not worth wasting my thoughts on it. If you don't like dividends, don't invest in companies that pay them. Me? I want a return on my investment in MY pocket. So far, it hasn't seemed to hamper the businesses that I invest in.
I know a lot of small business owners. Some spend a lot of time working on their company and some are really hands-off. Yet I don't know a single one that doesn't want cash coming to their pocket on a regular basis.
P.S. Alex, I agree with you. Seems management can't make the smartest calls on a regular basis either.
The topic is a dead argument as far I'm concerned. Most of the time the thesis is based on the balance sheet alone without taking into account the income (P&L) and cash flow statements. Who, afterall, would go to work for a company and not expect a paycheck? You're just investing your labor rather than your cash. Do you not expect a return? Similarly, you invest your money in a company, do you not expect a return?
Yes, I know that you're not directly giving the company your cash when buying a stock on the open market but if you're going to look at it dogmatically, someone did when that stock was issued and that "someone" is just transferring that claim on the company's assets to you. In effect, it's as if you really gave the cash to the company just xx years later.
We've gone over this topic so much it's really not worth wasting my thoughts on it. If you don't like dividends, don't invest in companies that pay them. Me? I want a return on my investment in MY pocket. So far, it hasn't seemed to hamper the businesses that I invest in.
I know a lot of small business owners. Some spend a lot of time working on their company and some are really hands-off. Yet I don't know a single one that doesn't want cash coming to their pocket on a regular basis.
P.S. Alex, I agree with you. Seems management can't make the smartest calls on a regular basis either.
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan
“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan