Buyback of own shares

Unternehmen, die in reifen Industrien tätig sind, daher einen hohen Freien Cash flow erzielen aber oft nur wenige rentable Investitionen tätigen können, hatten früher Finanzanlagen getätigt, um das Geld anzulegen. Mit der Hinwendung zum Value-Management möchte die Unternehmung die freien Mittel den Aktionären zukommen lassen. Ein Weg dazu sind Ausschüttungen. Wenn Aktionäre Dividenden beziehen, fallen jedoch höhere Steuern an als wenn Kursgewinne zu verzeichnen sind. Deshalb sind Unternehmen in den USA schon vor einigen Jahren dazu übergegangen, eigene Aktien zurückzukaufen, eventuell mit der Absicht, anschließend eine Capital reduction durchzuführen.
In principle, this process should go hand in hand with an increase in the share price: If, for example, the company value of 10 billion euros is initially for 100 million shares and the price is 100 euros, and if the unchanged company value is 95 million shares after the repurchase, then at rational course formation the course is 105.25 euros.

Since the price formation on the financial markets anticipates the recognizable, the price jumps to the new level as soon as the management announces that it will buy back its own shares.

In the meantime, buybacks of own shares are also permitted in most European countries and have been practiced on various occasions. There are certain legal restrictions. Stock corporations in Switzerland are allowed to buy up to 10% of their own shares. Different forms are also practiced.
The arithmetical price increase can de facto be higher or lower.
On the one hand, buying back own shares is interpreted as a positive signal. Analysts and shareholders think management is unlikely to buy their own stocks if they are expensive from the information available internally. Therefore, the announcement reads that in the light of internal information, the shares are currently on the low side. This signal would reinforce the effect of the price increase in the event of an announcement.

On the other hand, management seldom commits to a capital reduction. For example, the shares could be bought back to be ready for management stock option programs. Perhaps it is also the content of the employment contracts that the shareholders have not yet taken very close note of. The shares may also be bought back because management is preparing an acquisition and intends to use the shares as “currency” for buying other companies. That would be a rather bad signal.

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