Yes, but we're not getting a $15 dividend per share we own are we? Which is what they will need to spend in the buy back (or near enough). It's simple maths that the capital spent on the buy back will reduce the profit level more than the percentage reduction of the number of total shares. The result being that the dividend will decrease in the short term. Long term, it will improve relative to the profit.
Think of it this way, each share will now be a bigger proportional piece of the pie (profit), but the pie (profit) itself has shrunk, so the piece you end up with is actually smaller.
Ann: On-Market Share Buy-Back, page-56
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$10.23 |
Change
0.310(3.13%) |
Mkt cap ! $1.851B | |||
| Open | High | Low | Value | Volume |
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| No. | Vol. | Price($) |
|---|---|---|
| 20 | 2500 | $10.22 |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| $10.23 | 1697 | 16 |
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