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Glossary · investing

What is Share buyback?

When a company repurchases its own shares from the open market, reducing shares outstanding.

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Buybacks return cash to shareholders and mechanically boost per-share metrics like EPS. Whether they create real value depends on the price paid — buying overvalued shares destroys value.

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Frequently asked questions

Buybacks vs dividends?

Dividends deliver cash directly (and are taxable when received). Buybacks let shareholders defer tax by concentrating ownership.

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