And investors shouldn't
count on another buyback boom.
Not exact matches
Examples of such projects providing marginal benefits are: improving financial reporting systems through better information technology, minor tweaks to supply chain logistics, cutting back
on marketing or increasing low - cost advertising (like social media), «rationalization» of head
count, holding average wages as low as possible, squeezing suppliers a little bit, not repatriating earnings to stave off taxation, refinancing rather than retiring debts, and the share
buyback that is insensitive to a company's current stock price.
Based
on the share
count before the
buybacks, EPS last year would have been only $ 1.81, little changed from $ 1.80 a year earlier, according to a Reuters calculation.
If instead we use total expenditures
on dividends plus net stock
buyback cash plus change in total debt divided by market capitalization, we don't need to worry about changes in share
count due to stock splits.
«The later stages of the 2009 — 2017 bull market are a valuation illusion built
on share
buyback alchemy... The technique optically reduces the price - to - earnings multiple because the denominator doesn't adjust for the reduced share
count... Share
buybacks are a major contributor to the low volatility regime because a large price insensitive buyer is always ready to purchase the market
on weakness... Share
buybacks result in a lower volatility, lower liquidity, which in turn incentivizes more share
buybacks, further incentivizing passive and systematic strategies that are short volatility in all their forms... Like a snake eating its own tail, the market can not rely
on share
buybacks indefinitely to nourish the illusion of growth.
Solid top - line growth, continued
buybacks (the outstanding share
count will be impacted by the Fox deal), robust profitability (we're talking net margin that averaged 15.63 % annually over the last five years), and the potential for additional scale gives the bottom line plenty of fuel for 2018 and
on.
of cash spent
on share
buybacks since Q3, but recognize the reduced share
count.