Re:Intel Brags of $152B in Stock Buybacks. Why Does It Need ...
by boh on Thursday March 28, 2024 @08:11AM
(#39850235)
From a basic economics perspective, companies conduct buybacks when they have no other use for the money. Since re-investment supports shareholders on a longer timescale, Intel has essentially let the market know they don't have any other use for the money they have. The point of investing in a company is the funds to be used to generate wealth. If I invest in your company and you just give me back my money, what's the point of the company (especially if its money requiring extra leverage to produce). Buybacks are inefficient use of invested capital (see NVidia's stock price if you need a comparison for a more efficient use of cash and its effect on shareholder value).
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Re:Intel Brags of $152B in Stock Buybacks. Why Does It Need ...
by gizmondo on Thursday March 28, 2024 @08:32AM
(#39850438)
Whether they are efficient or not entirely depends on the company. For every NVidia you can find another company (or ten) that reinvests inefficiently because managers tend to like building empires at the expense of their shareholders.