Originally Posted by
flyboy2181
Right. That example was for easy math. But the point is buying back stock allows you to spend the same amount of money on dividend payouts and still increase dividends. My argument is against people saying they should just increase dividend payouts. It’s a better investment to buy back stock.
The example still holds. It costs money to buy the stock. You don’t just magically reduce the amount of stock and increase dividends. That money could have been used for something else even if it was just a dividend.