Stock Buyback

 

 

One of the ways of rewarding shareholders is buying back or repurchasing of shares by the company itself. In effect, this move reduces the public holding of the particular company. The key factor is that the EPS will increase even if it means there is no change in the profitability of the company. Generally, the company resorts to repurchase of shares when it considers that its share price is not valued properly. This will benefit insiders or non-selling shareholders.