Share buybacks -yes or no ?

[Winston]

Buying back shares is a company investing in themselves. Depending on the interest rates being paid, sure, paying down debt can be advantageous as well.

But particularly in dying industries like Petroleum, its sort of pointless to spend money to expand production.

No it is not, and I think you are misunderstanding what buy back is. The companies don't buy the stock and hold it. They buy it and "retire" it.

 

[jotathought]

My heart sinks when compamies I invest in do this.I rarely see the benefit in real terms..

Any reduction in the share capital has negligable effect on the share price or the dividend and it seems to be the act of a management that has run out of ideas.

I would prefer the cash and a new board of directors.

Do buybacks work for you ?

Under normal market conditions, buybacks yield higher share prices by reducing the number of outstanding shares, it's unrealized gains, and it increases ownership for the investor.

That's not a benefit to you?

 

[jotathought]

Buying back shares is a company investing in themselves. Depending on the interest rates being paid, sure, paying down debt can be advantageous as well.

But particularly in dying industries like Petroleum, its sort of pointless to spend money to expand production.

Exactly correct

 

[Tommy Tainant]

Under normal market conditions, buybacks yield higher share prices by reducing the number of outstanding shares, it's unrealized gains, and it increases ownership for the investor.

That's not a benefit to you?

It doesnt feel like it.I invest in a company primarily to see my money grow. Buying back shares tells me that the management has run out of ideas.
Time to look elsewhere.

 

[Polishprince]

It doesnt feel like it.I invest in a company primarily to see my money grow. Buying back shares tells me that the management has run out of ideas.
Time to look elsewhere.

Buying back shares certainly shows that an outfit isn't growing as much for sure. But it could still be a good investment for widows and orphans looking for steady income.

 

[Toddsterpatriot]

It doesnt feel like it.I invest in a company primarily to see my money grow. Buying back shares tells me that the management has run out of ideas.
Time to look elsewhere.

Returning money is better than wasting money on bad ideas.

 

[Tommy Tainant]

Returning money is better than wasting money on bad ideas.

Give me the money then. Dont spend it for me.

 

[Toddsterpatriot]

Give me the money then. Dont spend it for me.

If you sell the stock that the company buys back, you have the money.

So what are you whining about?

 

[Tommy Tainant]

If you sell the stock that the company buys back, you have the money.
here.
So what are you whining about?

No . How am I gaining in that transaction ? Think about it for a moment.

 

[Toddsterpatriot]

No . How am I gaining in that transaction ? Think about it for a moment.

You have the cash value of the shares and now you don't have to worry
about how the company spends any money.

If you don't sell, how are you harmed by that transaction?

 

[Tommy Tainant]

You have the cash value of the shares and now you don't have to worry
about how the company spends any money.

If you don't sell, how are you harmed by that transaction?

Um, they are buying my shares with my money.

 

[Toddsterpatriot]

Um, they are buying my shares with my money.

Don't like what they're doing, sell.
If you like what they're doing, buy more.

In either case, keep whining.

 

[Tommy Tainant]

Don't like what they're doing, sell.
If you like what they're doing, buy more.

In either case, keep whining.

You are way out of your depth here.

 

[Toddsterpatriot]

You are way out of your depth here.

If you feel they're wasting money with buybacks, sell your shares.
If you think buybacks are fine, don't sell your shares.....maybe even buy more.

If you're gonna whine about every one of those choices, keep whining.
It's what you're good at.

 

[Dekster]

My heart sinks when compamies I invest in do this.I rarely see the benefit in real terms..

Any reduction in the share capital has negligable effect on the share price or the dividend and it seems to be the act of a management that has run out of ideas.

I would prefer the cash and a new board of directors.

Do buybacks work for you ?

Depends on how many shares are out there I suppose. I generally don't have a huge problem with it though I think it does inflate stock value for short periods when they are doing it. There is one company I still own a few shares of (did a big cash out of them a month or so ago to take profits) that may or may not go completely private. That is the rumor anyway. It is a smallish oil and gas company that gets loaded down with cash and has no plans to expand operations. The theory is that they will eventually buy back all the stock, but then again, I am not sure the virtue of that either to the company.

 

[MarathonMike]

My heart sinks when compamies I invest in do this.I rarely see the benefit in real terms..

Any reduction in the share capital has negligable effect on the share price or the dividend and it seems to be the act of a management that has run out of ideas.

I would prefer the cash and a new board of directors.

Do buybacks work for you ?

I've never viewed buybacks as very significant events. Reverse stock splits and dividend cuts are much worse.

 

[DudleySmith]

I own Shell ....this is all they do and the price of their stock is about the same as when I bought it. Yes they made record profits this yr......

I buy Shell gas for my cars and trucks. A couple of fuel haulers I've met say their refineries are the best run and highest quality in the whole pack.

 

[DudleySmith]

I've never viewed buybacks as very significant events. Reverse stock splits and dividend cuts are much worse.

They were borrowing free money from the Fed to finance a lot of the buy backs. CEO's like to do that because it makes their own stock options worth more. This will probably stop with the higher interest rates.

 

[Toro]

My heart sinks when compamies I invest in do this.I rarely see the benefit in real terms..

Any reduction in the share capital has negligable effect on the share price or the dividend and it seems to be the act of a management that has run out of ideas.

I would prefer the cash and a new board of directors.

Do buybacks work for you ?

Wrong.

Share buybacks are a function of capitalism. It's another way of returning cash to shareholders.

The Democrats and liberals opposition to share buybacks is ridiculous.

 

[Captain Caveman]

My heart sinks when companies I invest in do this.I rarely see the benefit in real terms..

Any reduction in the share capital has negligible effect on the share price or the dividend and it seems to be the act of a management that has run out of ideas.

I would prefer the cash and a new board of directors.

Do buybacks work for you ?

They do this to benefit the company, where the pros outweigh the cons, as opposed to benefit the shareholder.

So share by backs? Yes.