These 3 Dividend Stocks Are Buying Back Shares Hand Over Fist
There aren't often revolutions of thought in finance, but the move away from paying dividends and toward buying back stock has taken over the stock market over the past few decades. For most companies, dividends are taxed twice, once at the corporate level and then again at the shareholder level. Buybacks, on the other hand, increase each remaining shareholder's claim on the company's earnings and allows shareholders to choose how to sell stock to make the best decision for their own tax profile.
Though many businesses have seen the light and started prioritizing stock buybacks as a way to return value to shareholders, not many real estate investment trusts (REITs) have bought back material amounts of stock. That traditional argument about dividend tax efficiency doesn't fly for REITs, which do not face double taxation of dividends.
That said, the market is perfect right now for REITs to start buying back stock en masse. Not only has the majority of the industry lost a ton of value this year, but it is getting harder and harder to expand as interest rates rise. These three REITs -- Weyerhaeuser (NYSE: WY), Equity Commonwealth (NYSE: EQC), and Empire State Realty Trust (NYSE: ESRT) -- have already started buying back stock and increasing shareholder value in the process.
Source Fool.com
