In addition to being a vehicle
for returning cash to shareholders, they reduce the total number of shares outstanding, so they should increase the value for the remaining shareholders, right?
You're left pretty much in peace, and you can do classically shareholder - unfriendly, empire - building things like being acquisitive rather than classically shareholder - friendly, management - disciplining things
like returning cash to shareholders.
Here's some more color on
returning cash to shareholders from Butters» note: «Share repurchase programs have become a very popular way of returning capital to shareholders over the years.
Other companies announcing plans to
return cash to shareholders include Facebook Inc, which announced a $ 9 billion buyback program when it reported earnings last week, and AbbVie Inc, which plans a tender offer starting as early as May 1 to buy up to $ 7.5 billion of its stock.
In all these cases it was not until the stock became cheap and management began to
return cash to shareholders in earnest that the stocks rebounded nicely.
Management has proven they are shareholder friendly, not giving dilutive options and share grants, conserving cash and
even returning cash to shareholders that they feel they can't deploy (a $ 1 / share — equivalent to $ 10 post reverse split — dividend in December 2009).
Despite the strong start, concern remains among retail investors and portfolio managers that chief financial officers remain too fixated on
returning cash to shareholders through stock buybacks and dividends.
While some defend the buyback practice as a method
of returning cash to shareholders, others, including my colleague Larry Fink, have argued that some companies today are focusing on maximizing short - term shareholder value at the expense of investing in the future.
Now share buybacks aren't necessarily a bad thing, and in fact are Warren Buffett's preferred method
for returning cash to shareholders — as opposed to dividends — because they give management more flexibility.
After paying themselves nicely to run down the business (or actually exploiting for themselves what is left of the juice), they are now saying that it will take 6 months to
return cash to shareholders if it happens at all.
The company has launched a business review to
consider returning cash to shareholders, making medium - sized acquisitions and more aggressive cost cuts, the Financial Times reported on Wednesday.
In recent decades, share buybacks have overtaken dividends as a preferred way to
return cash to shareholders as there is more preferential tax treatment.
Instead, it has concentrated
on returning cash to shareholders through buybacks and dividends; earnings per share have risen nearly 40 % since the last quarter of 2014, while the quarterly dividend is up 43 %.
«One of the things you're seeing is a trend to
return cash to shareholders,» said Kevin Brown, research analyst with Tortoise Capital Advisors.
«In an environment like
this return cash to shareholders keeps them pleased with the short - term gains while not committing to large investments that could hurt performance.»
Buying back stock is, for example, Warren Buffett's preferred way of
returning cash to shareholders (rather than paying a dividend).
Corporations will boost sales and keep margins elevated allowing managements to both invest for growth and
return cash to shareholders via buybacks and dividends.
Apple's beefed up plans to
return cash to shareholders through dividends and buybacks will provide additional support for its stock price.
Coupled with its favorable market segments, Sprouts is generating positive cash flow and
returning cash to shareholders via a stock buyback program.
Still, given the size of the technology opportunities the company sees and the heightened level of competition, Apple's board says it's important to continue taking a measured approach to
returning any cash to shareholders.
While the Board and management oppose this shareholder proposal, they are fully committed to
returning cash to shareholders.
General Motors recently responded to an activist group with a plan to
return cash to shareholders through share repurchase, and Lear had previously undertaken this action.
Exploration and production companies are likely to update investors in their first - quarter reports on budgets and
returning cash to shareholders, according to Morgan Stanley.
And with a payout ratio of 47.8 %, you're looking at what's basically a «perfect balance» between retaining earnings for company growth and
returning cash to shareholders.
Qualcomm has no business being in the venture capital business and should instead
return this cash to shareholders.
Our first priority remains investing in new stores and the infrastructure to support our store growth, while our second priority is to
return cash to shareholders through anticipated dividends and share repurchases.