The argument seems sound to me, except that a company like Apple is such a great counter example.   In 1997, Michael Dell was famously quoted when asked about what should be Done with Apple (a company that Steve Jobs had _just_ returned to)<p>"What would I do?" Mr. Dell said to an audience of several thousand information technology managers. "I'd shut it down and give the money back to the shareholders."<p>The rest, is as well all know, history - Apple became worth more than Dell in 2006, and today, is worth almost six times as much as Dell.<p>I'm pretty certain Apple investors are happy that Apple didn't start issuing dividends and run the company on its (by then dying) Mac OS 8.x, but decided to completely reinvent itself on NeXT OS (aka OS X).<p>An anecdote, but a useful one.