Share repurchases can be both a good and a bad signal. Firstly, share repurchases is an alternative way to distribute cash ( instead of dividends). The way it works is that a company will buy back part of it’s share capital (the paid one not the authorized). The shares are usually cancelled, so the total shares that are issued are reduced.
A share repurchase should not have an impact on the holdings when all shareholders participate in the scheme. Regarding the signalling, a share repurchase can mean that the company has excess cash which is a good thing. It also means that the management believes that the shares are undervalued and that the company should be valued higher.
However, it can also mean that the company is not able to find projects that can offer decent returns. As they are unable to further expand the business, they prefer to distribute their cash reserves to the public.