5 ms·

Paying a dividend will not save Microsoft. Even Microsoft realizes that.

by dstein 15y ago

philwelch 15y ago
It will serve the long term interests of Microsoft shareholders; sadly, Microsoft doesn't realize that.
- dstein 15y ago
  Dividends reward short term shareholders. Capital reinvestment rewards long term shareholders (if it's successful).
  - Duff 15y ago
    10 years ago, Microsoft was $35. Today it is $25 and change. Not very rewarding. Microsoft is like the electric utility of the technology business -- they should embrace that or wake up and break up the company into manageable parts. Buying Skype? That's not creating shareholder value.
    - dstein 15y ago
      When you look at Microsoft's acquisition history http://en.wikipedia.org/wiki/List_of_mergers_and_acquisitions_by_Microsoft http://en.wikipedia.org/wiki/List_of_mergers_and_acquisition... There aren't many very large brand name "statement" acquisitions there. Most are small companies you've probably never heard of. I think this Skype acquisition is a clear message that Microsoft is playing hardball now.
    - garethm 15y ago
      For what it's worth, there was a stock split in 2003 [1], so the same stock would be $50 today. 1: http://www.microsoft.com/investor/InvestorServices/FAQ/default.aspx#section_4 http://www.microsoft.com/investor/InvestorServices/FAQ/defau...
    - smackfu 15y ago
      It's funny that this comment is in response to someone suggesting a dividend, yet completely ignores the dividend in mentioning the stock price over time.
  - philwelch 15y ago
    Is it better for shareholders to reinvest dividends from mature firms into growing firms, or for mature firms to continue investing in their own stalled growth?
  - ikono 15y ago
    >if it's successful That's a big if for them right now. When you're trading at a P/E in the single digits ex cash, the market is telling you they have no faith in your ability to re-invest your earnings(especially when interest rates are so low).
ikono 15y ago
I'm going to play a little devils advocate here. What if MS payed a big enough dividend that it was clear to everyone inside that burning money playing catch up was not a viable strategy. Is it not possible that fewer extraneous resources would force them to refocus?

Paying a dividend will not save Microsoft. Even Microsoft realizes that.

by dstein 15y ago

Paying a dividend will not save Microsoft. Even Microsoft realizes that.

philwelch 15y ago

It will serve the long term interests of Microsoft shareholders; sadly, Microsoft doesn't realize that.

dstein 15y ago
Dividends reward short term shareholders. Capital reinvestment rewards long term shareholders (if it's successful).
- Duff 15y ago
  10 years ago, Microsoft was $35. Today it is $25 and change. Not very rewarding. Microsoft is like the electric utility of the technology business -- they should embrace that or wake up and break up the company into manageable parts. Buying Skype? That's not creating shareholder value.
  - dstein 15y ago
    When you look at Microsoft's acquisition history http://en.wikipedia.org/wiki/List_of_mergers_and_acquisitions_by_Microsoft http://en.wikipedia.org/wiki/List_of_mergers_and_acquisition... There aren't many very large brand name "statement" acquisitions there. Most are small companies you've probably never heard of. I think this Skype acquisition is a clear message that Microsoft is playing hardball now.
  - garethm 15y ago
    For what it's worth, there was a stock split in 2003 [1], so the same stock would be $50 today. 1: http://www.microsoft.com/investor/InvestorServices/FAQ/default.aspx#section_4 http://www.microsoft.com/investor/InvestorServices/FAQ/defau...
  - smackfu 15y ago
    It's funny that this comment is in response to someone suggesting a dividend, yet completely ignores the dividend in mentioning the stock price over time.
- philwelch 15y ago
  Is it better for shareholders to reinvest dividends from mature firms into growing firms, or for mature firms to continue investing in their own stalled growth?
- ikono 15y ago
  >if it's successful That's a big if for them right now. When you're trading at a P/E in the single digits ex cash, the market is telling you they have no faith in your ability to re-invest your earnings(especially when interest rates are so low).

ikono 15y ago

I'm going to play a little devils advocate here. What if MS payed a big enough dividend that it was clear to everyone inside that burning money playing catch up was not a viable strategy. Is it not possible that fewer extraneous resources would force them to refocus?