Your writer will take a reactionary stance here, contrary to most modern finance theory.
For the long term investor, only dividends matter for the value of a stock.
I chose that terminolgy for the reason that there is a "theorum" taught in business schools and by finance academics that dividends don't matter. They are totally wrong.
A simple gedanken experiment proves my case. Suppose you buy the IPO of a stock, such as GM, EK (Eastman Kodak), or AAPL and, as a long term investor, simply hold on to it ... to the bitter end.
What money do you ever receive? The "bitter end" - the eschaton of stock investing - is either a cash buyout or bankruptcy. All cash buyouts are pretty rare nowadays. Can anyone name one in the past few years? Bankruptcies are much more common: GM, EK, etc.
Suppose the firm never pays a dividend. If the end result is bankruptcy, the value of a long string of zeroes is ... a big zero.
Suppose the firm pays dividends. Then even if the end result is bankruptcy, the long term investor has received some value that he can reinvest in bonds or other stocks.
Over the long term, the bankrupcty of firms is rather common. Management squanders cash and makes bad investments. How we can marvel at the recurring "non-recurring" losses!
They buy back stock. That only benefits the sellers by propping up their selling price. Who is a seller? For one, management is. They use stock buybacks to prop up their pay.
Why is AAPL stock apparently undervalued? No dividend. They have a huge and growing hoard of cash. The "market" obviously thinks management will squander it. And continue to squander it.
GE bought back huge amounts of stock while the price was high. And then proceeded to sell huge amounts when the price was low during and after the Panic of 2008. Buy high, sell low - brilliant management. Dopes? No, self-serving hogs!
Long term investors should only pay for dividends. Period. Full stop.