We will pass a milestone today in the $RUL buy back program. Based on Friday's report, today will see the cumulative buy back reach $20 million paid for 12.3m shares. There remain a maxiumum of 10.5m to go (22.8m total or 10% total SOI).

About $12m worth has been bought back over the last 12 months.

My reason for posting is that over recent months the behaviour of the buy back has changed. For much of last year, the buyback were more stop-start, dialling up when the SP fell below $1.55 and slowing or even stopping above about $1.60.

Now, with the SP right up at $2.45, they are pretty much buying $50,000 worth every day. On some days, they do buy fewer, and I think these are lower liquiduty days, when there are low volumes with offers close enough to the current SP. But I have been monitoring for a few months and $50,000 days are pretty much the norm. So $1m a month.

The buy-backs are typically 5-6% of average daily total volumes - although this varies hugely. Highest price paid is $2.60.

If the SP was to stay flat at $2.45, and if they keep buying $50,000, then the current announced program would run for another two years. Of course, SP likely to continue to rise, so it would go for even longer. Equally, there may come a point at which they stop as there is no obligation to execute the program announced.

I'm still puzzled why at $2.60, the highest return opportunity the board can see is eating themselves.

In the short term, I'm not complaining - as this level of buyback is continuing to put some support under the SP, and of course will directly drive EPS.

Disc: Held in RL and SM