Originally Posted by
Name User
Dividends are just forced sale of stock. As a shareholder I don’t want a dividend. The biggest reason is it shows the company has zero ideas to make additional money on their own and shows they’ve thrown in the towel trying to grow. This is bad news. A stagnant company might as well be a bankrupt company as far as pricing metrics go (acxcording to Wall Street).
In general I do not support share buybacks, as generally they are a poor use of capital. I would rather see the money in the bank as it kinda sorta has the same effect on valuation. That being said Wall Street really only cares about earnings growth, and the way to juice that is reduce shares outstanding.
I do however support some share buybacks and in the case of Spirit stock, which is IMO way undervalued currently, would definitely support that decision.
Several points. Firstly, I do not 100% disagree with your analysis, however, different investors value their invested capital differently and the return on said capital, in different ways. If you appreciate that viewpoint, we have a good start.
So, a company paying a dividend has no ideas? None sense imho. They just have the RECURRING LIQUID CAPITAL to pay their shareholders CASH$$$$!������. If a company doesn’t believe they have that kind of liquid capital to reward those who invest in them; offer kind words and the occasional stock buyback....
Your second paragraph was somewhat contradictory. You’d rather a company not invest in their shareholders at all? Or just not in the form of a buyback and/or dividend?? Earnings growth can be diluted in so many different ways that stock buybacks become even less relevant and less potent. Cash being paid to said investor, is imho, worth more.
I don’t support a share buyback until a pilot deal is done! Plain and simple. Rewarding those who have no real vested interest in the company before those who actually work for the company is just plain stupid. Pilots are a valuable resource these days, why waist the potential growth of the company on the few cents of EPS growth that a buyback can return?
FWIW, I own 0 shares in Spirit directly, and don’t intend to at their current valuation.