Warren Buffett is one man who advocates companies buying back their shares if the conditions are right. In his 1984 Letter to Shareholders, he opined, “When companies with outstanding businesses and comfortable financial positions find their shares selling far below intrinsic value in the marketplace, no alternative action can benefit shareholders as surely as repurchases.”
With that, let’s take a look at three companies picked at random that have repurchased their shares during the week.
1. Starburst Holdings Ltd (SGX: 40D)
According to its website, Starburst Holdings specialises in the “design and engineering of firearms-training facilities and the design, fabrication, installation and maintenance of anti-ricochet ballistic protection systems for firearm shooting ranges and tactical training mock-ups for law enforcement, military and security agencies as well as civil authorities in Southeast Asia and the Middle East”.
On 17 and 18 July, the firm bought back a total of 953,000 shares ranging from S$0.365 to S$0.380 per share, amounting to a total cost of close to S$355,000.
Starburst is currently going at a price of S$0.385 and has a historical dividend yield of 0.65%.
2. Singapore Post Limited (SGX: S08)
Singapore Post is no stranger to Singaporeans. With a history stretching back 150 years, it currently operates three business segments – Postal, Logistics and eCommerce. Singapore Telecommunications Limited (SGX: Z74) is the largest shareholder of Singapore Post with a stake of more than 20%.
On 18 July, the company clawed back from the market 316,000 shares at a price of S$1.361 per share. It spent S$431,446 in total for the share buyback.
At the time of writing, Singpost’s shares were trading at S$1.35. This translates to a price-to-earnings (P/E) ratio of around 160 and a yield of 2.6%.
3. Cordlife Group Ltd (SGX: P8A)
Cordlife is one of the leading players for private cord blood banking services. It operates in markets such as Singapore, Hong Kong, Malaysia, India, Indonesia and the Philippines. Its processing facilities are in Singapore and Hong Kong and they currently have an excess of 40,000 cord blood units stored there. Cordlife was listed in 2012 at a price of S$0.431.
On 19 and 20 July, the firm repurchased two million shares ranging from S$0.950 to S$0.965 per share, translating to a total cost of around S$1.93 million.
Cordlife is currently selling at S$0.95 and has a historical P/E ratio of approximately 19.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.