Cisco Just Demonstrated the Power of Stock Buybacks
Networking-equipment giant Cisco Systems (NASDAQ: CSCO) reported results this Wednesday, covering the first quarter of fiscal-year 2023. The company generated adjusted earnings of $0.86 per diluted share, surpassing Wall Street's consensus earnings estimate of $0.84 per share.
Investors and analysts applauded Cisco's strong results, and the stock price closed 5% higher on Thursday. However, I don't see a ton of headlines mentioning one of Cisco's most shareholder-friendly qualities: The company is shoveling billions of dollars straight into the pockets of shareholders. I'm particularly impressed by Cisco's effective use of stock buybacks.
Fun fact: If not for the anti-dilutive effects of the buyback program, Cisco would barely have satisfied the consensus-earnings target.
Source Fool.com
