Yes the share count would drop but so would our book value. Does the term spinning your wheels meaning anything to you? That's the case with most companies but IBM is buying back stock at only 10 times free cash flow and l10 year treasuries are yielding less than 2%. I believe that in their case they're creating value for shareholders that wish to stick around.
Sold some call options against my position in one of my IRAs today with about 3 minutes left to trade. They expire in June so therefor I get the upcoming dividend due in a few weeks.
Strike price is 175 and the premium was around 1.55/share.
In other news--time to plant some blueberries.
Reynolds American (NYSE: RAI) deal to acquire Lorillard (NYSE: LO) has a $740 million termination fee, according to SEC filings.
From the filing:
"The Merger Agreement contains certain termination rights for both the Company and RAI, including if the Merger is not completed on or before July 15, 2015 (which date will be automatically extended to January 15, 2016 if certain closing conditions related to antitrust matters have not been satisfied) and if the approval of the Company’s stockholders or RAI’s shareholders is not obtained. If the Merger Agreement is terminated in connection with the Company entering into an alternative acquisition agreement in respect of a superior proposal or making a change of recommendation, or in certain other circumstances, the Company must pay RAI a termination fee of $740 million. In the event the Merger Agreement is terminated by the Company due to a change of recommendation by RAI’s board of directors, RAI will be obligated to pay the Company a termination fee of $740 million."
And as of today the dividend yield is well under 4% because the stock has rebound yet again.
April options expire today so I'll have a large amount of cash available Monday for buying some of my favorites and selling additional put options.
paid me .32/share in IRA #2.
They're now paying .37 bid and .40 asked.
The buyer of the option does get the dividend in June if they exercise their option at 90.
Most of the sells were done in IRAs but I also have some orders open in my personal accounts that may fill today.
My favorite option was the June 90 calls that paid me .32/share in IRA #2.
Thank you again Mr. Market.
"AIG has confirmed that earnings will be announced 04/30/2015. With 23 analysts covering AIG, the consensus EPS estimate is $1.20, and the high and low estimates are $1.38 and $1.08, respectively"
Because you'll then have more cash on hand today to buy their products.
"Diageo spirits liquids and packaging were recognized across the board as best-in-class at the 2015 San Francisco World Spirits Competition, winning a grand total of 91 awards. Of these awards, 83 were medals, 39 of which were double gold or gold. In both Scotch and North American Whisk(e)y liquids, Diageo brands did especially well, with 14 brands winning multiple medals, and several being named "Best" in their category. In packaging, seven brands across Diageo's portfolio won medals, including Mortlach Scotch Whisky and Orphan Barrel Bourbon, which were both awarded double gold. The Company was also named "Importer of the Year" in recognition of Diageo's consistent high quality of spirits across all brands.
"We are honored to be recognized by such a prestigious competition across our portfolio, from heritage brands to new-to-world innovations," commented Larry Schwartz, President, Diageo North America. "Our craftspeople, including our distillers, blenders and artisans, use their remarkable skills every day to produce the finest spirits in the world. These awards give them, and everyone at Diageo, a great reason to celebrate."
You need to add another $5000/share to BRK's book value due to the HNZ/KRFT deal that should be completed in the 3rd quarter.