Investor Help (NO Ihub questions)

[cintrix]

Some companies like to have a lot of cash for acquisitions, etc - that is why a lot of the tech companies don't do divies. But sometimes the return on equity can be affected. Take a look at this article regarding why a company would do a divy - they explain it better:Last but not least most companies can only grow their ROE/ROA so much as they could be reaching the limits of their marketplace. The ROE would then incrementally start declining, making it worthwhile for these stocks to pay out dividends instead of spending the cash on acquisitions to buy competitors or start a division in a completely new sector in order to diversify. More often than not branching out into different industries does not work.
http://www.dividendgrowthinvestor.com/2008/11/why-should-companies-pay-out-dividends.html