Capital Allocation: Share Buybacks vs. Dividends

This course examines the two primary methods corporations use to return capital to shareholders: share buybacks and dividends. From a value investing standpoint, we analyze how management decisions regarding capital allocation impact intrinsic value and long-term shareholder wealth. You will learn to evaluate the tax implications, the effect on financial ratios like Earnings Per Share (EPS) and Return on Equity (ROE), and the signaling effect these actions have on the market. The curriculum focuses on identifying when a buyback is a prudent use of cash versus when a steady dividend policy is more beneficial for the long-term owner.