Mart Resources Inc MAUXF

RE: dividend vs buyback

[parapooper]

I disagree about the market forgetting a buyback since the buyback will increase EPS for eternity while dividends don't do anything for the value of the stock, sometimes the opposite in fact (see PBNs crash largely because of their dividend payments). If you don't trust the market will get it right at some point and would rather have cash than betting on stocks being repriced to what you think they are worth then why invest in the first place, especially in microcap companies operating in Africa? Maybe you are right that a dividend would do sth for the shareprice by bringing in new investors if it is high enough. But on the other hand it sort of steals upside potential for stock price appreciation from old investors who certainly did not invest in an oil explorer for the dividends.
If you get dividends tax free then you lose less than others from paying dividends vs. buybacks or growing the company.
Just for me personally, I specifically invest in companies that do not pay dividends because I pay 50% tax on dividends and 0% tax on capital gains. Also I'm in the stock market to find businesses who can multiply my money faster than I can do it myself. By buying their stock I am basically telling them "take my money and grow it, you can do it better than me" so it does not make much sense for them to give me money back when I just told them I'd prefer them to have and grow it.

If you consider that buybacks give leveraged gains compared to dividends, give additional leverage if the stock is priced too low to start with and that buybacks are basically them buying stock of a company I want to own with perfect timing and insider knowledge you have basically triple positive leverage from buybacks instead of zero to extremely negative leverage that dividends provide depending on taxes.