US corporations buying back stock through debt is going to pose a problem down the road for those stocks. Beware of problems in your holdings More
Buybacks, or share repurchasing, occur when a corporation decides to purchase some of their own shares back. One main reason companies implement a buyback program is to increase the earnings per share of their stock. A higher earnings per share can drive their stock price up and generate more interest in their stock, thus providing the company with more funds to work with.
As an investor, buybacks often signal a turning point for a company’s stock and usually point to continued growth. Because of that, investors would be wise to purchase stock around the time of a buyback to take advantage of the rising value of the stock.
Companies are trying to be more shareholder-friendly, via dividends and buybacks ... but contrary to popular belief, they're also investing in the future. More