Replies to post #689805 on Mr Cooper Group Inc (COOP)

[redisnieurt]

This is correct, but there is one other thing to consider.

The tangible book value per share will change as well.

If the stock is trading BELOW book value, and then the company uses excess capital to buy the shares back, then the impact is that the balance sheet shrinks by the amount of capital used, so the company would have a lower total book value. But buying the shares back at below book value would have an accretive effect for the remain shares.

So you get a TBV per share pop the day the buyback occurs and then the eps benefits as well.

This is a pretty standard move right out of the playbook for a company (Financials in particular) that is trading below book and has excess capital.

but again, I'm not expecting COOP to use excess capital right now, in light of a tough operating market ahead and possible rising delinquencies