QUOTE(TheLegend27 @ Jun 4 2018, 11:20 AM)
Hi guys, i have a question about share. Let's say a when a counter is undervalue, usually company will do share buyback or issue dividend to benefit shareholder. But when a counter is overvalue, what company can do to benefit shareholder?
Risky thinking.....
Share buybacks is never a 100% safe indicator that the share is cheap.
For example.
a) company thinks it is cheap but in reality it's not and the market might disagree.
b) a market event happens impacting the share. Company then buybacks the shares. Real example is the current MyEg buybacks. As you know MyEg after the elections die like shit. It fell to 90sen plus. MyEg then buybacks rather actively. Was it safe? Answer can be seen today... share kena hit again badly. ...
Anyone traded myEg just cause it did buybacks... mati lo.
c) sometimes companies buyback with hidden motives.........
Dividends.
Yes dividends are good but there are cases where handsome dividends are issued despite falling profits. As you know without profits, cash flow will deplete and sooner than later, such companies cannot maintain these generous dividend payouts....
Ps... your main question.
I do not know how to answer you.