Share Cannibals: Companies That Love to 'Eat' Themselves Part 1 | Value Investor Chatter | #68

If you're a value investor, you're always looking for companies that are undervalued by the market. But what about companies that are undervalued by themselves? Share cannibals are companies that buy back their own shares, typically when they're undervalued by the market. This can create value for shareholders, since it reduces the number of shares outstanding and can increase earnings per share. Share buybacks can be a sign that management believes the stock is undervalued, so it can be a bullish signal. But be careful - share cannibals can also be a sign of management's lack of confidence in the company's future growth prospects. So, are share cannibals an interesting play for value investors? It depends. But if you're looking for companies that are undervalued, they're worth a closer look.

Episode Outline

(00:00) Exploring Share Cannibals: Companies That Love to 'Eat' Themselves Part 1

(02:57) Discussion on Buybacks and Capital Allocation Decisions

(04:55) Discussion on Share Buybacks and Share Cannibalism

(07:55) Heading: Evaluating Capital Allocation Strategies for Growing Companies

(09:40) Discussion on Capital Allocation and Shareholder Return

(12:49) Discussion on Share Buybacks and Maximizing Shareholder Returns

(14:46) Discussion on the Pros and Cons of Share Buybacks

(19:50) Discussion on Poor Capital Allocation and Share Buybacks

(21:08) Discussion on Share Cannibalism in Oil and Gas Companies

(22:53) Discussion on Share Buybacks and Maximizing Shareholder Value

(24:42) Heading: Exploring Share Cannibalism and How to Evaluate Potential Investments

Value Investor Chatter

Facebook: https://web.facebook.com/valueinvestor49

Twitter: https://twitter.com/valueinvestor49

TikTok: https://www.tiktok.com/@valueinvestor49

LinkedIn: https://www.linkedin.com/company/valueinvestor49/

Website: https://valueinvestor.org/

---

Support this podcast: https://anchor.fm/valueinvestor49/support