Plain-English definitions, reviewed by an independent investor
Share Buyback
A buyback is when a company uses cash to repurchase its own shares, reducing the count and lifting per-share metrics.
A buyback is when a company uses cash to repurchase its own shares, reducing the count and lifting per-share metrics.
Shares Outstanding ↓ → EPS ↑ (all else equal)
Why it matters
It returns cash to owners and can signal management thinks the stock is cheap.
Common confusion
Buybacks can be funded by debt or mask weak growth; not always shareholder-friendly.
Frequently Asked Questions
Buyback vs dividend?
Both return cash; buybacks are flexible and tax-timed, dividends are steadier.
Why do stocks rise on buybacks?
Fewer shares means each owns a bigger slice of the same profit.