Buyback Baloney

Not all stock repurchases are bullish. Some add too much doubt or simply offset options plans

Wall Street has a way of taking a good thing and misusing it. Consider stock buybacks. For decades they were a comforting, surefire sign of management confidence. After the crash in 1987, hundreds of companies initiated plans to spend billions on their own dirt-cheap shares. That inspired investors to do the same and helped stanch the panic--a good thing. Today, though, buybacks can be more about funding management's stock options than about signaling its resolve.

Yes, plenty of companies still buy back shares for the right reasons. Deflated by the Firestone flap, Ford has increased and expedited a huge buyback unveiled...

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