People think buy backs are a silver bullet for the SP to rise ....

People think buy backs are a silver bullet for the SP to rise . Buy backs are a tool that marginally improves the metrics per share when shares are bought at prices below their core value . The buy back will result in an improvement in EPS however even a decent buy back of say 5% of issued capital will only result in a 5% increase in EPS all other things being equal ( 3.4 to 3.57 c ) so if the business earnings dropped by more than 5% per share then the buy back wouldn't have an impact . So in summary Gap is using two tools for capital management , 1 is a divi for ongoing return to Shareholders and the other the buy back is improving medium term return but it's the business performance that will drive most of the performance of the SP . People simply don't get buy backs and place on them greater power to impact SP them they have
The fact they have the ability to pay a divi and do a buyback and invest in the business simply shows they are sitting pretty at present