SHELL SHARES BUYBACK

MACKEM99

Does anyone know if it or how this affects UK shareholders?

Thanks

M99

DUBVENDOR

less total shares  the value of the rest should be worth more and divi is paid out to a lesser total number so should rise as well .

Prism

Most of the large companies buy back their own shares. It helps push the share price up. It is an alternative to dividends that companies use to return profits to share holders. The main difference is that you eventually need to sell those shares to make the gains, whereas with dividends you keep the shares.

MACKEM99

Thanks.  In the last I have had companies but an amount of my shares say for instance 20% and pay me for them.  Thus leaving the other 80 i still hold worth what the 100% was worth .. If that makes sense.  It seems the shell buyback works slightly differently to that.

cloud_dog

MACKEM99 said:

Does anyone know if it or how this affects UK shareholders?

Thanks

M99

As others have already said, in theory* the less shares in issue the higher the share price should be because you are dividing the asset amount by less shares.

* The caveat is whether they are going to cancel the shares or keep them on the books (I cannot recollect the correct term), because in theory if the shares are not cancelled Shell can simply re-release the shares raising capital for the business.  So if hte shares are not cancelled there may not be an exact like-for-like uplift in the SP, and it may only increase the SP by a fraction (whatever that may be) of the full equivalent value.

Nardy

cloud_dog said:

MACKEM99 said:

Does anyone know if it or how this affects UK shareholders?

Thanks

M99

As others have already said, in theory* the less shares in issue the higher the share price should be because you are dividing the asset amount by less shares.

* The caveat is whether they are going to cancel the shares or keep them on the books (I cannot recollect the correct term), because in theory if the shares are not cancelled Shell can simply re-release the shares raising capital for the business.  So if hte shares are not cancelled there may not be an exact like-for-like uplift in the SP, and it may only increase the SP by a fraction (whatever that may be) of the full equivalent value.

The term is Treasury Shares.

https://www.investopedia.com/terms/t/treasurystock.asp

pedrodelgado

In my recent experience, share buy backs do nothing for the share price. External forces seem more influential.