What are stock buybacks and why are many companies so recently attracted to them?
When you purchase a stock, you become a silent partner of that company. All decision making abilities are transferred to the CEO and the group of management employed by the company. These individuals have control over the day-to-day operations and weigh in heavily where the cash goes.
A company buys back stock using cash to increase shareholders ownership of their pie while reducing the total outstanding shares.
So, what happens to the shares the company buys back? Continue reading