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Has Microsoft Squandered Money on Share Buybacks?

Unless you live in a cave, you should know by now that Microsoft is one of the richest of all companies, with $50 billion in cash.

One big question is what Microsoft is spending it on?

A good deal of it has been going into stock buybacks, which leads to an even bigger question: Whether it’s being squandered on those buybacks?

Here's what you need to know:

Over the past ten years Microsoft has bought back $84 billion in stock, or roughly a third of its current market value.

But during that same period, its stock is off 24 percent—hardly what you’d call a winning investment.

With that as a backdrop: According to Ken Hackel of C.T. Capital, this past quarter marked only the second time in ten years that Microsoft went a quarter without a net buyback of its shares—that is, buying back more shares than it issued.

In fact, in the past quarter its share count actually went up.

Microsoft is currently working its way through a $40 billion repurchase program that expires in two years.

Questions? Comments? Write to HerbOnTheStreet@cnbc.com

Follow Herb on Twitter: @herbgreenberg

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