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Rob
''so if not to benefit the share price, what exactly is the benefit to share holders''
I give up - you, B and KR are lost causes - not worth wasting any more of my time on.
The market decided to give Lloyds a lower valuation today (market cap) than yesterday.
The share price is 53.32p
Without their buyback programmes the share would would currently be about 44p
"It seems one or two cannot comprehend, and need the same thing repeated to them over and over and over and over and over again until maybe then it sinks in (must be age related.)
The market decides on the valuation of Vodafone on a daily basis.
NOTHING TO DO WITH BUYBACKS, which the purpose of them is solely to reduce share capital"
It's because you keep trying to play the same trick of reducing the number of shares without accounting for the cost of reducing the number of shares.
Instead, you hide behind this nonsense of "The market decides on the valuation of Vodafone on a daily basis.". The market will reduce the valuation to reflect the reduction in cash and it will be offset by the reduction in shares, so no real change. Shock horror, this doesn't turn out to be a fool proof way to drive up the share price by reducing the numbers of share in issue at zero cost.
Age related i'm only 21 lol
so if not to benefit the share price, what exactly is the benefit to share holders
Rob
''just an estimate, by how much do you think the 4 bn buyback could increase the share price by, we know the markets determine the share price on a daily basis, i'm just asking by how much do you think the buybacks should increase the sp by''
??
please read and comprehend -
it seems one or two STILL cannot comprehend, and need the same thing repeated to them over and over and over and over and over again until maybe then it sinks in (must be age related.)
The market decides on the valuation (market cap) of Vodafone on a daily basis -
NOTHING TO DO WITH BUYBACKS, which the purpose of is to solely to reduce share capital.
Buybacks for cancellation would increase the SP over what it would otherwise be.
LTI, just an estimate, by how much do you think the 4 bn buyback could increase the share price by, we know the markets determine the share price on a daily basis, i'm just asking by how much do you think the buybacks should increase the sp by
BE
do a bit of shopping over the weekend to find yourself a brain that functions
it seems one or two STILL cannot comprehend, and need the same thing repeated to them over and over and over and over and over again until maybe then it sinks in (must be age related.)
The market decides on the valuation (market cap) of Vodafone on a daily basis.
NOTHING TO DO WITH BUYBACKS, which the purpose is to solely to reduce share capital.
Buybacks for cancellation would increase the SP over what it would otherwise be.
Also do you not understand how contradictory you sound? On the one hand your saying the buybacks will effect the SP then on another your calling people stupid and saying on the market determines the SP, which is it?
So day 1 vodafone buys back 1% of shares. The SP doesn't move due to buybacks? Only what the Market decides? Haven't you just agreed we are correct then? If the buybacks don't cause the SP to move then x less shares = lower market cap.
It seems one or two cannot comprehend, and need the same thing repeated to them over and over and over and over and over again until maybe then it sinks in (must be age related.)
The market decides on the valuation of Vodafone on a daily basis.
NOTHING TO DO WITH BUYBACKS, which the purpose of them is solely to reduce share capital
But he's not saying its not am investment, he's saying the market cap drops, shares in issue drop = SP stay the same, so his investment is flat. I personally believe there will be some SP growth but not in a linear way. Reduced float will reduce supply and demand should improve as the future earnings improve due to loss making markets being exited, but not purely as a result of buybacks. Ironically I was in barc, they spent last couple of years doing sizeable buybacks, it wasn't till a while after they finished that the SP went north, loads of factors involved I get it. But at no point did you see x shares purchased and cancelled and a correlation to the SP compensating
Dan
''Thank's a lot Fleccy if you can help me on this one. ''
Flec is not too keen on buybacks.
You have already been given relevant info regarding buybacks - it is up to you to digest properly which would help with investment decisions.
The current market cap is under 22 Billion Euros. Your stated believe is that a 4 Billion investment in Vodafone shares would reduce that figure by 4 Billion, which with your thinking would make Vodafone not a very good investment to be purchasing .
"" and the reduction of this large discount to the assets value "
If you looked at the huge book value forthe German assets and compared it to the recent German performance, you would think the assets were over valued
Have to hope they dont have to do any write downs on book values within the forthcoming end of year results
Have to see what they do with the book asset value for Spain too, and later Italy"
This is a concern that I have. They couldn't make money in Italy and Spain so rightly jumped ship, they state they haven't been able to get a decent return in the UK for years and won't in the future without a merger and I'm not sure if the Germany results are going to be too pretty in the short term at least. They just don't seem to be able to get a decent return in Europe at the moment and I'm not sure that the net asset value reflects that yet.
Desperate Dan, Fleecy make it up as he go along.
.
I nows morre than I letts on you no.
He be like a potatoes wafle wiv out tha potato
Accolade this week goes to Newsid, who just edged it , well done
Vod closing Sp 5th Apr 68.58p
Speech Speech Newsid
Full list will follow Enjoy your weekend Atb
Fleccy. Hello, I wonder you could help me here. Vod's market cap is it's share price times the shares in issue. My question is, if vod buys back shares in a buy back scheme, will this mean as there are less shares in issue after the buy back, the market cap will fall unless the share price rises. If the market cap doesn't fall then it would seem to me that a share buy back is a one way upward bet as each share holder will own a larger slice of the company. It seems to me that after a share buy back the market cap should fall, but because each share will own a larger share of the company then it will balance out. I am all for buy backs if the managment think that is good thing, but it is good to fully understand how it all works. Thank's a lot Fleccy if you can help me on this one. Cheers & have good one.
" and the reduction of this large discount to the assets value "
If you looked at the huge book value forthe German assets and compared it to the recent German performance, you would think the assets were over valued
Have to hope they dont have to do any write downs on book values within the forthcoming end of year results
Have to see what they do with the book asset value for Spain too, and later Italy
"The market determines the value of Vodafone on a daily basis.
There is no direct connection between the assets that Vodafone have and the market cap. "
Yes there is. The value and performance of those assets largely determine the share price, as well as other factors beyond the companies control. This "large discount" is reflected in the current share price and the reduction of this large discount to the assets value is what you are stating is what makes the buyback excellent value.
Fingers crossed it start to close rather than continuing to widen!
The market determines the value of Vodafone on a daily basis.
There is no direct connection between the assets that Vodafone have and the market cap.
Vodafone net assets at about 63 Billion Euro
Current market cap is less then 22 Billion Euro
this makes buybacks excellent value, making investments purchasing at a large discount the assets that generate the Vodafone profits that are the main driver of market valuations.
Vodafone make excellent returns on these assets making the investment of 4 Billion very hard to beat
Vodafone net assets at about 63 Billion Euro
Current market cap is less then 22 Billion Euro
this makes buybacks excellent value, making investments purchasing at a large discount the assets that generate the Vodafone profits that are the main driver of market valuations.
Vodafone make excellent returns on these assets making the investment of 4 Billion very hard to beat
"Vodafone net assets at about 63 Billion Euro
Current market cap is less then 22 Billion Euro
this makes buybacks excellent value, making investments purchasing at a large discount the assets that generate the Vodafone profits that are the main driver of market valuations."
Only if they can close that value gap but I'm glad that you now acknowledge the value of a businesses assets will have an impact on it's share price. Sadly, it seems to have been moving steadily in the opposite direction, so either the market is wrong, they aren't worth that in the first place/are depreciating in value, or the market believes that this management team can't realise their full potential. Hopefully, the picture will be clearer in May.
"Returns allocated to shareholders from profitability of the business will in the near future be distributed to Billions fewer shares."
This is true. The buybacks won't drive any increase in profitability but will mean that what profitability there is will be divided between less shares. I suppose the flip side would be that the 4 billion could be invested in a profit making venture, so you'd have an increased level of profit shared between the existing number of shares.
Returns allocated to shareholders from profitability of the business will in the near future be distributed to Billions fewer shares.
Vodafone net assets at about 63 Billion Euro
Current market cap is less then 22 Billion Euro
this makes buybacks excellent value, making investments purchasing at a large discount the assets that generate the Vodafone profits that are the main driver of market valuations.
Just to add. In this regard, I don't disagree. If the buybacks are completed and the valuation gap between net assets at about 63 Billion Euro and current market cap at less then 22 Billion Euro closes, clearly they will have played a blinder. The elephant in the room is, will that happen!