Is First Citizens BancShares ($FCNCA) Quietly Engineering a Banking Empire No One Saw Coming?
Share purchase is a form of shareholder return and we can roughly approximate it as a buyback yield:
Some of you would prefer dividend payout and there are good reasons for that. I would go through the main reason later.
But I just want you to think about it this way:
- If we know that the market values a company based on its stream of income
- And its earnings growth surprises
- And if you have a management that is committed to buying back their shares, which means return to shareholders
How likely is the share price going to remain down… all else being equal?
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