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Outlook Group Corp. (OUTL) Message Board

  • importantquest importantquest Dec 22, 2005 10:13 AM Flag

    Is this dividend tax free?

    Why is declare dividend a bad thing for stock price?

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    • It is not always a bad thing. But a special or increased dividend when a stock or company has taken a hit could lead you to think think that the company feels that 6 cents in your pockets is more useful than our collective 6 cents in theirs.

      For a mature company, growing dividends means faith in growing profits. It could mean the same here. But at the same time, could you not use all of that cash and purchase new technology? I am not saying do that. In this sector, dividends are part of spending. If you cut it or don't pay it it really looks bad. It is not a fast growing market, so if they retain all earnings and stop paying what the peers do, then you take a real hit as well.

      As far as tax free...it is a dividend. Not sure where that question came from. Perhaps from hearing of a stock split being issued in the form of additional tax free shares? Those are washes not cash payments. Unless this is sitting in a tax deferred account, you should have taxes. But at these rates unless you are a major holder I doubt you need to set aside the piggy bank to pay ;)

 

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