The big run today would seem to be confirmation of the abrupt run up yesterday. Some sell activity kicked in around 2:45 yesterday and did slap the trend down to the end of the trading day but in the first 15 minutes of trading today gave that effort a huge dope slap and the market never looked back. It will be interesting to see if the profit taking in the last 10 minutes today continues tomorrow.
No matter how credible Compass Point might be I cannot see they could make the market move like we have seen. It will be interesting to see the other shoe or 7 drop. Quite possibly CP divined some message from the tea leaves that led them to steal a march. JMHO, honest but not at all meant to imply expert.
On the plus side, the buy back will reduce the number of shares outstanding albeit a relatively small percentage. Given the same total earnings the EPS will rise which will provide a bit more cushion for the ratio Dividends / EPS. If they buy back Preferred that would increase the total earnings, a nudge in a similar direction.
Read the Motley Fool item completely and you will find pretty far down:
"At present, BB&T's payout ratio comes in at 46% -- well above the 30% threshold."
That is important because "In the second case, since the financial crisis, banks have been reluctant to increase their dividend payouts if their payout ratio already exceeds 30%. According to the Federal Reserve, "Plans with dividend payouts greater than 30 percent of net income ... [receive] particularly close scrutiny."
"In the first case, given King's assessment of an overall "sluggish" economic environment, there are few places inside the operation to put the cash to work that would produce satisfactory returns on investment. And on top of this, there's nothing "imminent out there" on the mergers and acquisition front."