The Wall Street Journal declares that "Coach Will Buy Back $1 Billion of its Stock."
Coach (COH), on the other hand was less optimistic. After noting that it had recently completed its $1 billion buyback announced in November of 2007 (Back when the stock was considerably higher, raising questions about the value generated by this repurchase), Coach said, in the standard boilerplate, that its "Board of Directors has authorized the repurchase of up to $1 billion of its outstanding common stock by June 26, 2010. . . The company may terminate or limit the stock repurchase program at any time."
Right: Coach announced that it might, if it feels like it, buy back up to $1 billion i stock and, if it doesn’t it won’t. Nothing wrong with that, but it’s very different from the company saying it "will buy back $1 billion of its stock."
The timing of the announcement is also mysterious. Shares of Coach were down nearly 7% on the day, and the buyback looks like an effort to get the stock moving in the right direction again — something it hasn’t done in awhile.
With the likes of The Wall Street Journal playing along, it just might work.
Zac Bissonnette
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