27% profits every 20 days?
This is what Nic Chahine averages with his options buys. Not selling covered calls or spreads... BUYING options. Most traders don't even have a winning percentage of 27% buying options. He has an 83% win rate. Here's how he does it.
There are several ways that a company can return wealth to its shareholders. Price appreciation and dividends are the two most common ways, but there are other ways a company can introduce returns to buyers. One method that is less common, or overlooked, is share buybacks.
Here we are going to take a look at what a stock buyback is, how it can affect a stock’s price and what it means for investors. We’ll also give a look at companies that have recently announced buybacks.
A stock buyback, also known as a share repurchase, occurs when a company buys back its shares from the marketplace with its accumulated cash. A stock buyback is a way for a company to reinvest in itself. The repurchased shares are absorbed by the company, and the number of outstanding shares on the market is reduced. This makes the relative ownership stake of each investor increase, as there are now fewer shares on the market.
Here are some companies that have recently announced large buybacks:
- Twitter (NYSE:TWTR) Along with a sour earnings report, Twitter reported a new $4-billion buyback program Thursday.
- PepsiCo Inc. (NASDAQ:PEP) Shares of PepsiCo Inc. rose 1.4% in premarket trading Thursday after the beverage and snacks giant reported fourth-quarter profit and revenue that topped expectations, boosted its dividend and set a new $10-billion stock repurchase program.
- Bristol Myers Squibb (NYSE:BMY) Bristol Myers Squibb said Wednesday it has entered a $5-billion accelerated share buyback program with Morgan Stanley (NYSE:MS), Barclays Bank (NYSE:BCS), Citibank (NYSE:C) and JP Morgan (NYSE:JPM). The stock is down 1.24% during the afternoon trading session.
- British Petroleum (NYSE:BP) BP recently completed a $500-million buyback, and announced on Tuesday, Feb 8. another $1.5 billion in buybacks.
- DuPont (NYSE:DD) Along with a positive earnings report released on Wednesday, DuPont announced a $1.5-billion buyback. Shareholders were receptive to this, as the stock closed in positive territory.
- Bath and Body Works (NYSE:BBWI) Bath and Body Works recently reported new guidance, along with a $1.5-billion buyback. The stock has gained more than $4 per share since the Feb. 2 announcement.
27% profits every 20 days?
This is what Nic Chahine averages with his options buys. Not selling covered calls or spreads... BUYING options. Most traders don't even have a winning percentage of 27% buying options. He has an 83% win rate. Here's how he does it.
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