Are Companies Buying Back Stock Too Soon

by J John Swanko

06/15/2010 (People Port) Stock buy backs used to be a great way to boost your share price. Today, firms are considering buying back their shares anew. Could have been a good idea in 2009, today it shows very productive firms may have unskilled management.

In 2007 there were more than one tale of a retiree selling their stock because the firm did not or in some instances, refused to raise the dividend. The stock price was just to high to keep it. Many of those were lucky. Sold the stock, their house, and moved to a sunbelt retirement home they vacationed in for years.

Searched the web for some examples, none. I too, heard the tale. I remembered July... The point, stock buybacks now seem to indicate a firm cannot manage these tough waters, headwinds. Many firms are building up cash now, some were lucky or smart and had enough cash to make this far.

These are tough times. If you pay a dividend, people expect it. There are all types of ways to get shareholders assets of a firm, however, those firms with large cash on their books could do better moving on some of their projects that seemed to be a good idea before this Great Recession started.

A good buyback reason, way under-priced shares, lots of shorts, dividends were increased, most of your competitors cannot compete, gaining market share, and your firm's future could not look brighter. The commonly reported assumption in 2001, 2007 firms were playing with the ratios.

I am testing alternate platforms.

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I took the links out and moved it here for publication on 11/23/10. It, my notes, were lost for a time, that note, article will not run.