Total Investor Yield

I mentioned this before but Shawn Tully has an interesting article on the concept of total yield — the dividend yield plus buybacks.

As I’ve written many times before, I’m not a fan stock buybacks. As a shareholder, I’d much rather have the cash in hand. A major issue is that too many companies wash away any benefit of share buybacks with massive executive stock compensation.

In theory, I really like the idea of total shareholder yield, but I’m afraid that it needs to be adjusted to benefit companies that primarily use share repurchases to benefit shareholders. By the way, DirecTV ($DTV) is a good exmaple of a company that truly lowers its outstanding shares.

Posted by on February 19th, 2013 at 12:40 pm


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