I like this program to buyback up to 5% of outstanding shares. One reason is it helps support the share price - although with BCE's fat dividend yield this is probably not really necessary. More important is that a 5% share buyback effectively increases the earnings by 5% even if actual earnings don't increase. Warren Buffett is a big believer in share buybacks for that reason. I think if George Cope continues to streamline and focus BCE on profitable areas while carrying out an annual share buyback program the BCE share price will really rock over the next few years.
The company buys back shares slowly over the year on dips so can get more for less. After disappointment of Teacher's reneging on purchase BCE a bad taste for many, and telecom sector is out of favour sector right now, so price stays depressed even with fat dividend. I think 2 things will see higher BCE stock price. First, increase in EPS and dividends under new CEO's program. Second, investor realization that telecom is solid. Remember, the stock market measures popularity, not value!
Yesterday's announcement of early retirement inducement to 1,500 BCE employees is another positive indicator of Cope's plan to turn BCE into a lean, mean profit machine. I like what this guy is doing and hope the meatheads on the BCE board don't get in his way.