Discover why this corporate strategy has both supporters and critics.
Companies repurchase their own shares to reduce supply, boosting share prices and potentially rewarding investors.
While dividends offer regular payouts, buybacks give companies flexibility, potentially raising stock prices and EPS.
Buybacks increase EPS, provide tax efficiency, and signal company confidence, but are they always the best choice?
Critics argue buybacks can signal a lack of growth opportunities, prioritize short-term gains, and mask underperformance.
Buybacks can artificially inflate stock prices, raising concerns about market manipulation and wealth inequality.
While stock buybacks have advantages, they aren't always in the best interest of long-term growth or economic equality.