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In the grand scheme of things this is simply money that's lost to the stock market... Aside from the short term artificial boosting of the share price to preven

In the grand scheme of things this is simply money that's lost to the stock market... Aside from the short term artificial boosting of the share price to prevent downsides, what other reasons would prompt such a mammoth buyback?

nickburns 2y ago
regulatory costs, legal fees, and smaller revenue projections than they've been enjoying over the past two or so decades perhaps.
airstrike 2y ago
It's management's job to return capital to shareholders, so this is really just another day in the office
- Timber-6539 2y ago
  They can do that directly by increasing the dividends paid per share to investors.
  - airstrike 2y ago
    Dividends signal a commitment to future dividends, which is not always preferable. So called special dividends are one-time, but they raise eyebrows Dividends can also be taxed differently. There's some nuance there beyond my expertise, but generally share buybacks are taxed more favorably (although there have been recent legislative efforts to change that)
ericmay 2y ago
There’s nothing artificial or “boosting” about stock buybacks. The price goes up because the float decreases. Sometimes companies will buy back their stock strategically because they believe it is undervalued - that’s a long term strategy.
- lupire 2y ago
  What's artificial are the compensation plans that are written in terms of nominal (gameable) share price instead of real market caps and payouts to shareholders.
- Timber-6539 2y ago
  There nothing more artificial than re-purchasing your own shares to drive up the price. > Sometimes companies will buy back their stock strategically because they believe it is undervalued - that’s a long term strategy. Depends on how the buyback is deployed (maybe if done in intervals) but I'll assume the announced buyback by Apple is to be done immediately to offset any drawbacks arising from their recent disappointing earnings call.
  - ericmay 2y ago
    You're asserting without evidence that Apple is buying back shares to drive up the stock price. I'm dismissing that claim unless you can provide anything within the ballpark of reasonable evidence related to that claim.
    - Timber-6539 2y ago
      That's exactly what a stock buyback is. https://www.investopedia.com/terms/b/buyback.asp https://www.investopedia.com/terms/b/buyback.asp
      - ericmay 2y ago
        Stock buyback != "artificially drive up share price". Someone else provided a nice little breakdown [1] of how buybacks work in comparison with dividends. I recommend you read that, and also actually read the article that you posted instead of continuing to argue a point that you are incorrect about. Apple specifically has continued to return value to shareholders via stock repurchases over a long period of time. There's nothing artificial or abnormal about their stock buybacks, and you can do the research for yourself to compare their stock buyback programs with the company performance over time. [1] https://news.ycombinator.com/item?id=40247051 https://news.ycombinator.com/item?id=40247051

nickburns 2y ago

regulatory costs, legal fees, and smaller revenue projections than they've been enjoying over the past two or so decades perhaps.

airstrike 2y ago

It's management's job to return capital to shareholders, so this is really just another day in the office

Timber-6539 2y ago
They can do that directly by increasing the dividends paid per share to investors.
- airstrike 2y ago
  Dividends signal a commitment to future dividends, which is not always preferable. So called special dividends are one-time, but they raise eyebrows Dividends can also be taxed differently. There's some nuance there beyond my expertise, but generally share buybacks are taxed more favorably (although there have been recent legislative efforts to change that)

ericmay 2y ago

There’s nothing artificial or “boosting” about stock buybacks. The price goes up because the float decreases. Sometimes companies will buy back their stock strategically because they believe it is undervalued - that’s a long term strategy.

lupire 2y ago
What's artificial are the compensation plans that are written in terms of nominal (gameable) share price instead of real market caps and payouts to shareholders.
Timber-6539 2y ago
There nothing more artificial than re-purchasing your own shares to drive up the price. > Sometimes companies will buy back their stock strategically because they believe it is undervalued - that’s a long term strategy. Depends on how the buyback is deployed (maybe if done in intervals) but I'll assume the announced buyback by Apple is to be done immediately to offset any drawbacks arising from their recent disappointing earnings call.
- ericmay 2y ago
  You're asserting without evidence that Apple is buying back shares to drive up the stock price. I'm dismissing that claim unless you can provide anything within the ballpark of reasonable evidence related to that claim.
  - Timber-6539 2y ago
    That's exactly what a stock buyback is. https://www.investopedia.com/terms/b/buyback.asp https://www.investopedia.com/terms/b/buyback.asp
    - ericmay 2y ago
      Stock buyback != "artificially drive up share price". Someone else provided a nice little breakdown [1] of how buybacks work in comparison with dividends. I recommend you read that, and also actually read the article that you posted instead of continuing to argue a point that you are incorrect about. Apple specifically has continued to return value to shareholders via stock repurchases over a long period of time. There's nothing artificial or abnormal about their stock buybacks, and you can do the research for yourself to compare their stock buyback programs with the company performance over time. [1] https://news.ycombinator.com/item?id=40247051 https://news.ycombinator.com/item?id=40247051