Share buybacks are good right? The company uses their free cash to buyback shares which reduces the number of remaining shares such that each share has a higher claim over future profits which adds to their value.
Further they're tax efficient in that paying dividends results in dividend tax.
Locally we do see buybacks, but share issues are relatively small so the impact is less shares and more value per share.
Using IFRS accounting diluted HEPS uses the share count of all outstanding shares PLUS all promised shares not yet delivered. These are basically options that could become shares and gives a way better reflection of the profit, even thugh not yet issued they will potentially come to makret and be issued.
Apple (Nasdaq code: AAPL) has been buying back shares and as such over the last decade it's outstanding shares is down about 38%.
Meta (Nasdaq code: META) has also been buying back, but they also issue shares at such a pace that over the last decade shares outstanding is basically flat.
The problem with telcos
I have long said that telcos such as MTN (JSE code: MTN) and Vodacom (JSE code: VOD) is that they are essentially utilities and should be priced as such.
But actually that statement is wrong.
Sure voice (who still calls using voice?) and data are utilities like water and electricity.
BUT the telcos have a problem, capex.
Yes we're using more and more data but prices keep coming down, I recently bought an effective 80 GB for little over R400. And all that while capex is increasing. They're busy rolling out 5G but as soon as that's done it'll be tine for 6G. It's a never ending tread mill.
Updating minister Gordhan's portfolio
Public Enterprises Minister Pravin Gordhan has declared his holdings, we reviewed his portfolio last time in April and there are some interesting changes, he is fairly active in buying and selling. Most notable is the total value is up almost R2million?