SoftBank is once again splashing out on its stock

Like a central bank defending its battered currency, SoftBank is once again splashing out on its stock. The Japanese tech group plans to buy back as much as 7 per cent of its shares, adding to billions of dollars it has spent on buybacks in the past two years. It was not enough to impress investors. SoftBank’s shares fell 5 per cent, along with the broader market. The promised $4.8 billion buyback of shares was less than a quarter the amount activist investor Elliott Management, and other shareholders, had hoped for. The timeline for the repurchase is drawn out, running through March 15 next year. Buybacks following large drops in the share price are becoming a trademark of boss Masayoshi Son, who believes the tech group’s shares are undervalued by almost a half… SoftBank is disproportionately exposed to gig economy companies such as Uber, China’s Didi and Singapore’s Grab, which would be hard hit by a pandemic. Of its portfolio companies, Indian hotel company Oyo Hotels & Homes is particularly vulnerable… Investment in the tech sector is plunging amid a rush to safe havens. SoftBank’s dividend yield of just over 1 one per cent, well below both peers in the telecom and tech sectors, make it an increasingly unattractive choice. 

Lex.

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