Buying
back stock generates capital gains while dividends create income.
Not exact matches
Although our nightly swing trading newsletter is basically a dynamic service that
generates specific
stock and ETF trade ideas, the main goal of our trading system is to aggressively trade the best technical trade setups when conditions are ideal, but also be ready and able to quickly and cut
back market exposure by reducing position size on new trades (or simply not trading at all) when market conditions deteriorate.
Buying
back stock should only be considered when we either can not invest (sometimes that's a function of regulatory policies) or when we are
generating excess, unusable capital.»
Scenario 2 — Reinvest To 2015 Levels: If, instead of buying
back stock, GE could quickly redeploy the capital from the sale of the financial assets and earn the same ROIC on that capital, it would
generate enough cash flow to justify the current
stock price.
Back then, I didn't really care about which
stocks or sectors
generated the best annual performance because I focused only on very short - term trends (typically 1 to 3 days holds).
However, we have no problem with
stocks that make a profit but plow
back in everything they make and then some (negative free cash flow), as long as they are
generating sufficient returns on capital.
Someone who started out with a mix of 70 %
stocks and 30 % bonds when this bull market began
back in 2009 and simply re-invested all gains in whatever investment
generated them, would have something close to a portfolio 90 %
stocks and 10 % bonds today.
I just sit
back and collect growing passive dividend income my real - life six - figure dividend growth
stock portfolio
generates for me, which is now in the five figures.
«There are plenty of pockets in the world where
stocks need to double or triple to get
back to their all - time highs, so there is a lot of opportunity to
generate returns,» he said.
Juicy Excerpt:
Stocks were so insanely overpriced in the late 1990s that even 12 years of zero returns has not been enough to pull valuations
back to where they must go for the
stock market to
generate good returns on a going forward basis.
Back when the
stock market was
generating long - term annualized returns of 10 % or so, this rule worked, kind of.
Over the last four years, revenue has increased steadily and the company has
generated a steady cash flow to buy
back company
stock, pay a dividend, and pay down outstanding debt.
If profits are continually
generated, eventually there will be a dividend once the company grows to its desired size or the company will buy -
back shares and reduce the total amount of
stock in circulation thereby increasing the value of each
stock remaining investors hold.
DRIP is a program you can set with your broker up and automatically reinvest all your dividends
back to the
stock which
generated that dividend.
We have $ 19.5 B in cash,
generate over $ 2B of cash flow from operations each quarter, and have bought
back $ 37B of our company's
stock in the last 5 years.