Warren Buffett is someone who strongly encourages companies to buy back their shares if the conditions are right.
In his 1984 Letter to Shareholders, he said:
“When companies with outstanding businesses and comfortable financial positions find their shares selling far below intrinsic value in the marketplace, no alternative action can benefit shareholders as surely as repurchases.”
On that note, let’s look at three Straits Times Index (SGX: ^STI) components picked at random that have repurchased their shares thus far during the week.
CapitaLand Limited (SGX: C31)
CapitaLand is one of Asia’s largest real estate firms with a global portfolio of assets such as integrated developments, shopping malls, and offices.
On 26, 27 and 28 February, and 1 March 2018, the company bought back a total of 7,256,900 shares at a price range of between S$3.60 and S$3.67 per share. The total cost came up to around S$26.4 million.
CapitaLand’s shares closed at S$3.61 on Thursday. This translates to a price-to-book (PB) ratio of 0.8 and a dividend yield of 3.3%.
Oversea-Chinese Banking Corporation Limited (SGX: O39)
Oversea-Chinese Banking Corporation, or OCBC for short, is the longest established local bank and is the second largest financial services group in Southeast Asia by assets.
On 26, 27 and 28 February, and 1 March, OCBC repurchased 800,000 shares at a price range of between S$13.08 and S$13.47 apiece. The total cost was close to S$10.7 million.
Shares of OCBC ended at $13.21 on Thursday, giving a PB ratio of 1.5 and a dividend yield of 2.8%.
United Overseas Bank Ltd (SGX: U11)
With more than 500 branches in 19 countries, United Overseas Bank (UOB) is one of the largest banks in Southeast Asia.
On 26, 27 and 28 February, and 1 March, UOB bought back 198,604 shares ranging from S$27.68 to S$28.74 per share, translating to a total cost of around S$5.6 million.
UOB’s shares last changed hands at S$28.04 on Thursday. This gives a PB ratio of 1.4 and a dividend yield of 2.9%, excluding any special dividend.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended shares of United Overseas Bank Ltd. Motley Fool Singapore contributor Sudhan P doesn't own shares in any companies mentioned.