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I wouldn't put dividends in the same dirty bucket as buybacks. Buybacks are just a way to manipulate the market and dodge taxes.
by elzbardico 2y ago
I wouldn't put dividends in the same dirty bucket as buybacks. Buybacks are just a way to manipulate the market and dodge taxes.
- s1artibartfast 2y agoIm one of the people that thinks they are functionally the same with a tax benefit (not a dodge) Manipulation of the market rings hollow. The price changes, but there is no deceit. Running a successful business or starting a dividend also changes the price, but isn't manipulation. Who exactly is duped by BuyBacks?
- FateOfNations 2y agoThe only segnificant difference is that with stock buybacks, they have a bit more control over how and when it happens. Investors have turned dividends into a religion. They must come every quarter like clockwork and never decrease; otherwise, it seems like there's a five-alarm fire and the place is on the brink of bankruptcy. It is irrational but reality.
- s1artibartfast 2y agoyou are preaching to the choir.
- mlazos 2y agoThey’re the same. They publicly announce both on earnings calls and both increase demand for a stock.
- ac29 2y agoBuybacks dont dodge taxes, they just defer them.
- s1artibartfast 2y agoI wouldn't even say they defer them, because the taxable event has not occurred. It allows people too let leave their money at risk longer, including the gains. If BuyBacks make stock price go up, stockholders haven't made any money yet. They can be wiped out at any time and lose everything. BuyBacks simply give the shareholders the choice of if and when to cash out any gains and losses they may have.