RSSMicrosoft Ups Stock Buyback by $16B
By Nate Mook | Published August 18, 2006, 4:11 PM
Microsoft is expanding the stock repurchase program it first announced July, pledging to spend an additional $16.2 billion buying back the company's shares through June 30, 2011. The total planned expenditure now tops $36 billion.
The Redmond company's first tender offer closed Thursday, and included 155 million shares of common stock totaling $3.6 billion. This number amounts to 1.5 percent of total outstanding Microsoft stock. By utilizing its massive cash reserves to repurchase shares, Microsoft is hoping to revitalize its stagnating stock price and appease investors.
MS shares will gain in value once Vista is released. It won't be an immediate spike in price, but it will take 12 months or so as companies evalute the product and roll it out. By the 2007 Christmas season Vista will be everywhere and MS will be counting the millions made from buying up these shares.
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For this kind of money they could have build a giant laser on the moon to blast competition.
Microsoft is loosing it. :)
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The solution to Microsoft's stock market problem
ultimately ~isn't~ buying back shares. At best,
THAT shall only cause a temporary spike in their
share prices.
Corporations create value in the stock market by
creating and selling innovative and useful products
and services.
What a novel idea ! Making things to make money !
Microsoft not coming out with a new OS for five
years is like Toyota not coming out with a new
car in five years. Dah ! No wonder their stock
has problems !
There's no excitement about Microsoft products
anymore. Only technophiles give a damn about
WinVista.
Corporate shufflings and stock buy-backs AREN'T
a long term solution to inertia at Microsoft.
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The Computer Rodent
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"Microsoft not coming out with a new OS for five
years is like Toyota not coming out with a new
car in five years. Dah ! No wonder their stock
has problems !"
No it isn't. MS hasn't lost any significant marketshare. They've released no less than 8 Operating systems since XP was released.
Toyota would lose share against competitors.
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Corporations create value in the stock market by
creating and selling innovative and useful products
and services.
It would be nice if that were the case, and was probably the original reason behind the stock market back when stocks could not be bought or sold in a manner of minutes; but advances in technology has turned the stock market into nothing more than an unending horse race where bettors jump horses during the race.
Microsoft not coming out with a new OS for five
years is like Toyota not coming out with a new
car in five years. Dah ! No wonder their stock
has problems
If what I heard was correct, and recall it correctly, car companies did not always feel the need to come out with new models every year; in fact, creating new models every year keeps their revenue stream steady. After all, consumers would expect a car model(unused) from five years ago to cost alot less than the same model of this year, even if the only changes were the newer model came with a cd player that played mp3s, and its ash tray had a light.
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Are you a Microsoft employee, perhaps ? You claiming that Microsoft released 8 OSes since XP was released, well, that's just a fairy tale.
They actually released only three OSes, Windows 2003 and Windows Mobile 2003 and 5. Any other version like Media Center are just repackaging of what they already have with some applications added.
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"turned the stock market
into nothing more than
an unending horse race
where bettors jump horses
during the race"
...
Yeah ...in the ~short~ run. ( Which is all
Microsoft's stock buy-back will affect. )
But lasting stock value ONLY comes from
product value. ~That~ has never changed !
...
"car companies did
not always feel the
need to come out with
new models every year"
...
Depends upon what is meant by new "model".
But the facts are: The automotive manufacturers
have come out with "new" vehicles annually since
at least the 1960's.
Often just a change in body styles, and a few
improvements in functionality and performance.
Nobody is saying that Microsoft should mimic
Apple and come out with a new OS version every
week.
However, nothing but service packs and security
updates IN OVER FIVE YEARS is a little ridiculous
by ~any~ criteria !
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The Computer Rodent
...
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Windows Mobile 2003
Windows Mobile 2003 Second Edition
Windows Mobile 5.0
Windows CE 5.0 (whis is not the same than WM5.0)
WIndows XP
Windows XP SP2 (almost a new OS)
WIndows Server 2003
Windows Server 2003 R2
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Guys, it's obvious that PC Rat was referring to desktop OS, ie. Win XP's successor. Mobile OS and server OS don't count. Apple might have called SP2 a new version of an OS if it were their OS. But I disagree.
I sincerely believe that MS is doing the right thing by not releasing a new desktop OS for so long. By not letting the business & marketing people rushing the engineers to release something like Windows ME, MS will be able to build a much better OS: Vista. Although significant features were subsequently dropped, it still seems like a worthy upgrade to Win XP.
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All your shares are belong to us.
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lol
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Microsoft should buy UPS at $16B.
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a cheap attempt to inflate market prices.
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While it IS an attempt to increase market price (as ALL stock buybacks by every corporation in the world always are, which is obvious - duh), it is certainly not a "cheap" one.
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Cheap attempt? Try a 16 Billion dollar attempt...
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"cheap" as in low-brow. Not inexpensive. However, for MS, $16B is chump change.
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they should just issue it as dividend because all these stock buy back will eventually because stock options that going to grant to the executives.
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Say what?
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Microsoft ALREADY issued the largest one-time corporate dividend in history (announced July 21, 2004 and paid December 2, 2004, totalling $32B) and doubled its annual dividend at the time (which didn't even exist 2 years prior) so obviously the dividend approach wasn't effective.
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