Iomega Dividend

[OffTilt]

On October 2 they are paying a 5$ dividend per share, since shares only cost 11.50 or so this seems pretty outrageous. I'm invested in it, just wondering, how far will the price fall come October 3? Any ideas? Will it drop to all the way to 6$ so I will only break even?

[adios]

When the stock goes x-dividend it will open at the previous day's closing price minus $5.00 a share. Interesting and thanks. I'll give it a look see and get back to you. Maybe GTW (Gateway) will do the same type of thing. I posted about it when it was $2.30 a share and had no debt and cash on hand of $3.00 a share. GTW is going for $6.05 now.

[Wildbill]

I suspect it could do a little better, just because that cash was dead money. These days the markets love companies that focus and earn good returns on investment. Taking away management's ability to make bad investments might get a decent vote of confidence. Further management itself likes it because it puts cash in their pockets and helps reduce the potential for a buyout or management shakeup should their price had gone down like Gateway's where people basically were saying they expected the company to just squander its money.