Stock Buyback

What is it? Corporate repurchase of stock from shareholders. Investors typically view a stock buyback as a positive signal. Companies often buy back their own shares because management believes the stock is undervalued. Cash flow maybe increasing, and putting money into their own stock may be a better investment than other alternatives. And because there are fewer shares outstanding, earnings per share go up even if the actual dollar amount of earnings does not change.

Added By: Rebecca

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