It certainly makes financial sense to do so as buying back shares on an equivalent current earnings yield of 10 per cent (the reciprocal of the PE ratio) is smart business with cash deposit rates so low. It not only takes excess stock off the market, and enables larger shareholders to take some profit off the table without holding back the share price, but it's significantly earnings enhancing too.
Furthermore, shareholders have been enjoying a steady income stream through dividends as this small cap company has paid out £12.3m since listing its shares on the Alternative Investment Market (Aim) in late 2005. That's the equivalent of 39.5p a share. There is another bumper payout on the way too as the interim payout has just been raised by over half to 5p a share for the six months to end February 2015 (ex-dividend: 3 June 2015). Share buy backs and a decent dividend stream aside, the investment case is pretty compelling for the fourth largest distributor of toys in the UK, Character Group (CCT: 415p).