Personally I'd rather see the cash stay in the company. Share buybacks normally let the shorters have a field day with the SP.
The other problem with your analysis is that you have left the earnings the same even though the company will be spending cash to purchase the shares. If this cash was invested in AAA rated Corporate bonds they could earn 5.7% on it. So $300M spent on a share buyback could generate apprx $17M in extra earnings.
Totally agree that the SP is to low but I'd rather the market decides the SP rather than trying to manipulate it by doing a Buyback.
Either a decent farmin agreement for Tanzania or good current quarter production numbers should sort the problem out.
BPT Price at posting:
$1.32 Sentiment: Buy Disclosure: Held
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