Valuation with share repurchases and personal taxes
推导了一个统一的估值方法，整合了现金股利、股票回购和主动债务管理的相互影响，并考虑个人税收，发现股票回购对股权市场价值有显著正向影响。
Abstract We derive a consistent valuation approach that integrates the interdependent effects of cash dividends, share repurchases and active debt management while considering personal taxes. The valuation approach is based on the assumption that a predetermined proportion of the flow to equity is used for share repurchases instead of cash dividends. Additionally, we examine the effects of share repurchases on the cost of equity by deriving appropriate adjustment formulae. Furthermore, we run simulations to investigate the valuation differences caused by the distribution of excess cash via cash dividends or share repurchases. The results show that share repurchases have a significant positive effect on equity market value.