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Re: Corp_Buyer post# 148188

Thursday, 03/09/2006 12:39:16 PM

Thursday, March 09, 2006 12:39:16 PM

Post# of 433251
Share buy backs do not increase market cap of a company rather they take shares out of circulation. The formula---------Shares outstanding X share price = market cap. Since there will be less shares after a buyback you can see that the value of the shares you hold would increase without the value of the overall company increasing.

Taking this argument to it's logical end lets say there were only 2 shares outstanding and the company bought back one from free cashflow and you held the other share......it would go up in value. Simple as that.

All this being said I don't really think your interested in admitting to understanding this or having a comprehensive discussion.

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