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A sign of strength or desperation? Baoshan Iron & Steel soars 10% in Shanghai after...

A sign of strength or desperation? Baoshan Iron & Steel soars 10% in Shanghai after announcing it will buy back up to $787M of its beaten-down shares. The refiners - namely Sinopec (SNP) and PetroChina (PTR) - join the rally as speculation falls on these giants as the next to commence repurchases. Shanghai +0.9%.
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  • chanthirani
    , contributor
    Comments (466) | Send Message
     
    That would depend. Are they buying back their shares with profits and free cash flow (FCF), or are they buying back by taking on more debt? If they are buying with FCF, then it is a sign of strength. If they are borrowing to buy back,then it is a sign of desperation.
    28 Aug 2012, 07:24 AM Reply Like
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