Are share buybacks a good thing?

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Would you opt in to sell back your shares to a company during a buyback? Do you think it’s a good signal for the future?

1 Answer

score 0 · Answer 1 · 2013-05-07T23:14:32+00:00

It can be a good thing if the company has excess cash reserves and they stock for example is believed to be undervalued. However, if the company has excess cash reserves and proceeds with a buyback because it has not investment opportunities, then no it’s not an ideal situation because it basically means that the growth opportunities are limited (if any).