If a company's stock is undervalued - as many managers believe theirs is - a repurchase may offer the best payoff of all.
Sentiment: NEGATIVE
Some managements do not even think of buybacks as an option. The idea of shrinking their equity base repels them. Their inclination instead is to get bigger, and this often leads them to pay rich prices for acquisitions that never earn their keep.
Approaches to determining stock values vary, but fundamentally, each company judging itself undervalued is saying that its future stream of earnings justifies a higher price than the stock market is willing to accord it.
It's not just buying the company. Sure, we picked the right companies, and we picked the right management and, most importantly, we've given them the right incentive to perform.
I think you have to learn that there's a company behind every stock, and that there's only one real reason why stocks go up. Companies go from doing poorly to doing well or small companies grow to large companies.
When the value of the company clearly has fallen below what its assets are worth, having a shareholder who says, 'Let's get a better board' can be helpful.
I think most CEOs think their stock is undervalued, probably.
Just because a stock is down doesn't mean it's a great buy.
If we take care of the business and keep our eye on the goal line, the stock price will take care of itself.
If you're running a business for the long term, the last thing you should be doing is borrowing money to buy back stock.
I don't like stock buybacks. I think if a company has the money to buy their stock back, then they should take that and increase the dividends. Send it back to the stockholder. Let them invest their money again from the dividends.