Volume 03, Issue 2
|Focus on Finance|
Face-to-face with Boeing owners
A key audience-more than 200 owners, investors and securities analysts whose opinions can have a tremendous effect on the Boeing stock price-gave a generally positive response to the work Boeing has done to deliver shareholder value and position itself for growth.
Boeing senior leaders last month gave this constituency a first-hand account of the company's plans and efforts at the annual Boeing investor conference, held in New York. For Boeing, the goal of this annual event is to build the confidence these key investor representatives have in the company's strategy, leadership, performance and future outlook. Their support of Boeing's achievements and outlook can translate into higher stock prices. That in turn can enhance employee benefits tied to Boeing stock, such as the Boeing stock holding in the Voluntary Investment Plan savings plan. Proper valuation and confidence in Boeing's outlook is also important for capital market participants, who influence the company's ability to raise capital to fuel growth and pursue new work for the company and its people.
Share repurchase program helps return value to owners
Boeing's recent reinstatement of the share repurchase program is the latest way the company is returning value to shareholders and signaling its improving outlook.
Shareholders generally consider share repurchases a good use of cash, since these actions return cash to the company's owners and can help increase earnings per share by reducing the number of outstanding shares. Buybacks also signal management's belief that purchasing shares is a good investment. Should circumstances change, management can start or stop repurchases as appropriate-just as Boeing has done over the last several years.
Finally, a share repurchase reflects financial discipline. It communicates that company leadership will return cash to shareholders after funding continuing operations and growth opportunities consistent with its strategy.
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