May be right time for huge stock buy back, any comments?
3 replies (most recent on top)
Stock buybacks are a total waste of capital. From a strategic viewpoint, only companies with absolutely no other way of implementing stockholder value should consider them.
Personally, I'd prefer innovation and new, growing revenue streams. Juniper has invested aggressively in it - the next 12-18 months will tell if it was in the right market pockets.
Stock repurchase boosts EPS.
Tax rules give share repurchases a clear advantage over dividends. Shareholders must pay taxes on dividends, but they don’t pay capital-gains taxes unless they realize their gains by selling. Even then, they don’t pay taxes on the entire sale proceeds, only the capital gain (if any). A dividend gives shareholders no alternative but to take the cash and pay taxes. With a share repurchase, shareholders have a choice. They can either sell shares and pay taxes on the capital gains, or they can let their investment ride.
- from an article
Stock buyback means remove stocks from market, meet expected earnings per share and distribute more Stocks to upper management to fuel the greed in the Bay Area.