Guzman Share Repurchase Monthly Report – March 2015
Guzman & Company released its March 2015 Share Repurchase Monthly Report, which deepens the firm’s January analysis by examining the same Guzman-created indices of highest buyback-yielding and highest dividend-yielding companies to quantify the tax benefit to the long-term investor of companies primarily buying back stock vs. companies primarily paying dividends.
Summary: The “buy high, sell low” argument criticizing the buybacks of 2007 and the issuances in 2009, single out specific stocks and fail to examine the data on a longer-term, aggregate basis. History clearly shows that buybacks lead to outperformance for the long-term investor on a through-cycle basis, especially when we consider tax implications. Despite dividend reinvestment and compounding, total returns for companies that repurchased stock dwarfed those that focused on dividend distributions by ~12% since 2004.
Read the full report here: Monthly Share Repurchase Update – MARCH 2015