How about some accounting --- dividends and earnings per share do not have an inverse relationship; in other words we are not faced with EITHER .06 EPS, OR dividends as your post implies, nor do dividends reduce reported earnings (they reduce cash). In fact, their relationship nearly mirrors each other --- if you have decent earnings, then it is likley that you may have cash on hand to pay a dividend. EPS is an income statement item; and dividends are a balance sheet item. Please don`t confuse the two.

Also there was a post that seemed to imply that dividends had an impact on the taxes of the company --- not the case either. Taxable earnings are computed from the income statement with tax expense computed and dedcuted therefrom and then paid out of cash. If after that, there is still ample cash on hand, the BOD can declare a dividend if it so chooses out of the remaining cash available.

Just wanted to assist in clearing this up.