CLSA - downgrade to A$4.20 TP, page-47

I think you misunderstood the gist of comment which was meant to be that overpaying to buy back your shares because you have extra cash to do so is a waste of money. And i don't know that we are arguing at cross purposes here.

Perhaps i should have been more detailed in explaining things but couldn't be bothered. The general point you are illustrating with your example is of a company that is likely undervalued with respect to its fair value and therefore it is worthwhile using excess funds to purchase back its own shares. Buffett has referenced book value in the past as a measure but i don't think the general idea is much different .. just the parameter used.