Get ready for an uptick in share repurchase plan announcements.
This earnings season as Technology companies issue weak guidance you can be sure that many of those companies will announce new share repurchase agreements to support stock prices. Share repurchase agreements are a waste of capital in my view. CEOs should invest in their businesses rather than bolstering the value of their options plans with false demand provided by share repurchases.
The test will be whether CEOs actually pull the trigger on share repurchases. Will CEOs execute share repurchase agreements when they know sales pipelines are fraught with uncertainty and share prices could be headed significantly lower?
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