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Author: makfan Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 942  
Subject: Re: Dumb question about split... Date: 12/13/1999 7:57 PM
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In QCOM's case, I would think that and increase of shares to 1,200,000,000 would suffice. Will the extra 2,800,000,000 billion shares effectively dilute the EPS of the stock, or is this a function of shares outstanding?

You are correct - they have asked to increase the number of authorized shares substantially more than necessary to effect this split. However, they are not planning to issue all those shares at the present time.

I believe the board is being proactive and ensuring that it has plenty of shares on hand for future splits, acquistions and employee option grants. Consider that after the split, the price will still be over $100 based on today's price. Also, with the way that QCOM's price has appreciate you can bet employees will be cashing out some option shares. Holding special meetings to approve additional shares does increase expenses, so I'm in favor of the company avoiding them. (I admit I was surprised at the 10x increase, however).

Mike
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