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15 May 2018

stock market--When a company "buys back" their own stock, is this a good or bad thing for the shareholders?

Because share buybacks reduce the supply of available shares, they tend to increase the stock price. (ie Supply and Demand)

Essentially, the company’s executives are using company profits to drive up the value of their own shares/options. So some critics say it’s a legal way of diverting profits to the execs, though all shareholders benefit if the stock price rises.

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