4 ms·
The difference between the two is not just taxes. The bigger difference is the accretion (dilution) that the company gets from buying shares below (above) intri
by eigenvalue 12y ago
The difference between the two is not just taxes. The bigger difference is the accretion (dilution) that the company gets from buying shares below (above) intrinsic value. A dividend of $1.00 is worth $1.00-- buying a share that is really worth $50.00 for $25.00 is more beneficial for the remaining shareholders.
- pedrocr 12y ago> The bigger difference is the accretion (dilution) that the company gets from buying shares below (above) intrinsic value. Sure, if you believe your stock is overvalued raise cash and retire debt, and if you believe it's undervalued take on debt and buy back shares. That's orthogonal to the issue of "if I want to give back 100$ to my shareholders what's the best way to go about it?".
- deleted 12y ago[deleted]
- prostoalex 12y agoTypically if the company is doing so great that it's flush with cash to do a share buyback, its stock won't be discounted.