4 ms·

How does hoarding cash increase the share price to generate those capital gains? Shouldn't they be buying back their own shares?

• ceejayoz 7y ago
  The company's market cap will typically factor in the giant hoard of cash. As it increases, so does the stock.
  • nootka 7y ago
    Doesn't that contradict noego's ultimate point?
    • sokoloff 7y ago
      A company that has an extra $100MM in cash will have a market cap approximately $100MM higher than the same company without the extra cash. noego's point is that that $100MM might be more valuable if freed up to invest in a risk-asset, but not that is has no value whatsoever.