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Strategies & Market Trends : Value Investing

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To: Brendan W who wrote (5302)11/21/1998 1:33:00 AM
From: MCsweet  Read Replies (1) of 78596
 
Buyback

Regarding LDRY's buyback, I think that to best serve their
existing shareholders, most companies should offer stock
when it is overpriced and buy back when it is underpriced.
(Unless they really don't need the money in the case of
selling and do need the money in the case of buying back.) So
I am almost always happy to see these buybacks. Of course, I
can't praise management in light of poor performance leading
to huge stock declines, but you have to put some of the blame
on shareholders for over-optimistic expectations, even if
management encourages some of these expectations. For instance,
I would not blame the executives at Yahoo (or any of these internet
stocks) if their shares went to 1/4 of their value, considering
that it is the shareholders themselves that have priced in such
high expectations.

MC
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