Warren Buffett is someone who strongly encourages companies to buy 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.”
On that note, let’s take a look at three companies picked at random that have repurchased their shares so far this week.
1. Oversea-Chinese Banking Corporation Limited(SGX: O39)
Oversea-Chinese Banking Corporation, or OCBC for short, is the longest established local bank and is the second largest financial services group in Southeast Asia by assets.
On 4, 5 and 6 December 2017, OCBC repurchased a total of 600,000 shares at a price range of between S$12.31 and S$12.51 apiece. The total cost was around S$7.4 million.
Shares of OCBC are going at S$12.16 now, giving a price-to-book ratio of 1.4 and a dividend yield of 3%.
2. AEM Holdings Ltd (SGX: AWX)
AEM designs and manufactures equipment and precision components for the semiconductor, solar and smart card industries.
On 5, 6 and 7 December, the firm bought back a total of 183,200 shares at a price range of between S$2.82 and S$3.20 per share. The total cost was slightly below S$558,000.
AEM’s shares are changing hands at S$2.87 currently. This translates to a trailing price-to-earnings (PE) ratio of 8 and a dividend yield of 2%.
3. Hi-P International Ltd (SGX: H17)
Hi-P is an integrated contract manufacturer that provides a one-stop solution for customers from various industries such as telecommunications, consumer electronics, computing and peripherals.
On 5, 6 and 7 December, the company bought back a total of 500,000 shares ranging from S$1.60 to S$1.65 per share, translating to a total cost of around S$813,000.
Shares of the contract manufacturer are now selling at S$1.65. This gives a trailing PE ratio of 15 and a dividend yield of 12.7%.
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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.