AA records $1.5 billion profit
- Thread starter robbedagain
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nycbusdriver
Veteran
WeAAsles said:
Yes, we all saw how effectively Wolf protected the stockholders with his $1.8 billion stock buyback. Let's take a poll and see how they made out subsequently!
traderjake
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- Aug 30, 2002
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traderjake said:
Debt and lease prepayments: $2.8 billion
PullUp
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- May 22, 2010
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Buybacks should be illegal. They do nothing to enhance the company, increase profitability, further the business, etc. except placate shareholders. And that is short-lived. Wolf's 1.8B buyback could have kept US out of BK post 911 or at least bought them more time to restructure.
I'm glad to see a dividend was declared instead .Kudos to mgmt.
Cheers.
I'm glad to see a dividend was declared instead .Kudos to mgmt.
Cheers.
WorldTraveler
Corn Field
- Dec 5, 2003
- 21,709
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- Banned
- #20
stock buybacks are absolutely legal and can very much increase the value of a company's stock.
it all depends on the mgmt. of the company; both stock buybacks and dividends are now becoming the fashionable thing to do in the industry.
It all goes back to the competitiveness that resulted from one megamerger trying to outdo the other.
Parker noted over 3 years ago that US needed to be involved in one more megamerger because by that time, DL and UA had both been to the altar.
"US Airways, the fifth-largest U.S. carrier, failed in a 2006 hostile bid for Delta Air Lines Inc. (DAL) and in two rounds of merger talks with United Airlines. Chief Executive Officer Doug Parker said in April he saw “one big deal left” in the industry, one involving US Airways, after the purchase by Delta of Northwest Airlines Corp. and the merger of United and Continental Airlines."
http://www.bloomberg.com/news/2011-11-29/united-continental-delta-air-may-gain-from-amr-s-bankruptcy.html
it all depends on the mgmt. of the company; both stock buybacks and dividends are now becoming the fashionable thing to do in the industry.
It all goes back to the competitiveness that resulted from one megamerger trying to outdo the other.
Parker noted over 3 years ago that US needed to be involved in one more megamerger because by that time, DL and UA had both been to the altar.
"US Airways, the fifth-largest U.S. carrier, failed in a 2006 hostile bid for Delta Air Lines Inc. (DAL) and in two rounds of merger talks with United Airlines. Chief Executive Officer Doug Parker said in April he saw “one big deal left” in the industry, one involving US Airways, after the purchase by Delta of Northwest Airlines Corp. and the merger of United and Continental Airlines."
http://www.bloomberg.com/news/2011-11-29/united-continental-delta-air-may-gain-from-amr-s-bankruptcy.html
WorldTraveler
Corn Field
- Dec 5, 2003
- 21,709
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- Banned
- #22
nope... my post shows that Parker was seeking a deal more than 3 years ago when US and AA were the only two legacy carriers left without mergers.
PullUp
Veteran
- May 22, 2010
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I know they are legal - IMHO they should not be.WorldTraveler said:
Buybacks do nothing to increase the value of the company, or boost earnings. However, they do increase the metric known as EPS (earnings per share).
When the number of shares decreases, the earnings per share naturally increases.
That metric entices stupid investors who fail to look deeper into company information before plunking down their cash.
Meanwhile, the 'nest egg' or 'war chest' or 'rainy day fund' - whatever you want to call a company's cash account - is drained, ultimately weakening the company and taking away its ability to weather economic turmoil.
In summary, I feel that putting your company at risk to increase the EPS metric without actually increasing earnings is a waste of company resources that does nothing for investors or employees, or the company's financial security.
Cheers.
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