Former Intel CEO Pat Gelsinger advises that a leader's job is to temper the extremes of market cycles. Instead of being a cheerleader, a CEO must act as a point of reality, ensuring the organization understands that "the high is never as high and the low is never as low."

Once a clear buy signal for investors, large-scale share repurchases now often indicate that a company with a legacy moat has no better use for its cash. This can be a red flag that its core business is being disrupted by new technology, as seen with cable networks and department stores.

Companies often announce and execute buybacks to appease the market, not because their stock is undervalued. This programmatic repurchasing, especially at cyclical peaks, destroys value. Truly value-accretive buybacks are rare because most managers lack the capital allocation skill to time them effectively.

Unlike other sectors, share buybacks are rare for REITs because management prioritizes maintaining low leverage to please debt rating agencies. When a conservative REIT does initiate a buyback, it's a strong signal that management believes the stock is significantly undervalued, as they are willing to risk a negative watch from those agencies.

The ultimate differentiator for CEOs over decades isn't just product, but their skill as a capital allocator. Once a company generates cash, the CEO's job shifts to investing it wisely through M&A, R&D, and buybacks, a skill few are trained for but the best master.

Experience taught Herb Wagner that great leaders consistently surprise on the upside. He now weights leadership quality far more heavily, assessing CEOs not by interviews or charisma, but by their verifiable track record and through trusted backchannel references who have worked with them directly.

Companies termed "share cannibals" aggressively repurchase their own shares, especially when undervalued. This capital allocation strategy is often superior to dividends because it transfers value from sellers to long-term shareholders and acts as a high-return, low-risk investment in the company's own business.

Profitable, self-funded public companies that consistently use surplus cash for share repurchases are effectively executing a slow-motion management buyout. This process systematically increases the ownership percentage for the remaining long-term shareholders who, alongside management, will eventually "own the whole company."

Investor preference for CEOs has shifted dramatically. While 2019-2021 favored scientific founder-CEOs, today’s tough market demands leaders with prior CEO experience. The ideal candidate has a "matrix organization" background, understanding all business functions, not just the science.