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ain't no fortunate son » Comments » BIDZ

  • If Insiders Are Unloading, Why Is BIDZ.Com Buying Back Shares? [View article]
    Follow the stock option awards. Many companies make a big deal out of announcing stock buybacks, but that is usually a crock... they merely buy back enough shares to replace newly minted shares produced by insider option exercises, so its a zero sum game - more shares outstanding due to the preferential option awards that get exercised, then the buyback to cover those shares.

    Net/net, the public shareholders get screwed because the cash to buy back those new shares comes right out of shareholder equity - and right into the insiders' pockets.

    And yet they have the nerve to look the shareholders in the face and say they are doing it because they think the shares are undervalued... bull!
    Jul 07 12:22 pm |Rating: +3 0 |Link to Comment
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