RE: Growth prospects23 Apr 2024 20:53
Kat-079, not sure you've thought about that much... If they bought the shares back and cancelled them, then issued the vested inventive shares to employees as they have done in previous years, then there would be the same number of shares in issue today? You also need to read note 24 - share based payments - in the annual report, as it the shares aren't given away by any means...
Also, if they paid a £10m dividend rather than buyback the 566k shares then right now the share price would be 40p lower (43.5m shares / £877m market cap - £10m dividend). You'd have a ~23p extra dividend, but lower share price...
You then also have to factor in that 566k shares would have been pressuring the share price, so it's highly likely it would still be sitting under resistance at £18
As for letting shares drift, would you be happy buying today at £12 and then waking up tomorrow to a £18 takeover offer?
For long term holders, a buyback at these levels make loads of sense. A lower number of shares in issue = a higher share price in future years. The ROI should end up way higher than a 1% dividend yield at present levels...