Dividends are far superior to buybacks. The only real difference...

Dividends are far superior to buybacks. The only real difference is that buybacks benefit option holders and not just existing shareholders.

Rough example that shouldn't be relied upon:

HIGH DIVIDENDS: WHC pays $1 div every year for 7 years. Most people will have their capital back. If coal was banned or taxed into oblivion and the company folded, you'd have lost nothing other than opportunity cost and the interest you could have earnt for the seven years. A close shave but survivable. Even if it has bad events in year 3.5 you only suffer a 50% capital loss.

VS

BUYBACKS: WHC does buybacks at high prices (higher than today's share price on average based on today's reporting, destroying extra money) and low dividends of 50c for seven years. The same investor has only half their money back if the company goes under in year 7 and the buyback only pumps the share price until the bad news which just results in everyone owning more of nothing. The risk to the average retail punter is greatly increased due to a longer capital payback time. They need the company to be going great at the time of selling to make up for the lower dividends, whereas captain dividend only needs it to pay back enough that it's free carry and they can choose to buy more themselves or not after that.

So for me, Cash printing companies that act like they need to be careful with dividend payouts are missing the point of the good times and high commodity prices. nobody owns a coal mine because it's a super cool industry that's growing 100%pa for the next 20 years - they want really high returns to cover the esg and commodity price risk.