Not a big fan of these words on HC but what about a share buyback?
Take out tax benefits of buying EXS and think about the following:
* SP trading between 60c and 68c. * Management has informed the market that they intend to pay a dividened of 38c per share (fully franked). * We have sellers prepared to sell at current prices.
If EXS announced a share buyback and the buyback happens to finish before the dividened payment, then the shares would be bought back very cheaply. E.g: buy back shares at 68c, subtract dividened liabilty of 38c, the company is effectively buying the shares back at 30c per share.
Most broker reports I have seen value the SP after the dividened payment at 42c and above......
Am I being to simplistic?
Lionel, thanks for your informative posts regarding the taxation implications and benefits of the dividened payment. .
EXS Price at posting:
62.0¢ Sentiment: Buy Disclosure: Held
