You are reading a single comment by @Sumo and its replies.
Click here to read the full conversation.
-
Buybacks are reinvesting in the company only in a financial engineering sense, it's not investing in productive capacity or anything useful. They are aiming to push up the share price.
They reduce tax burden and increase the value of the company if only on paper. There's a reason companies do it over keeping the profits.
I don't see such a big difference.
One is increasing the value of your company, literally the no1 goal of public companies. The other is effectively gambling.
Sumo
frank9755
Buybacks are reinvesting in the company only in a financial engineering sense, it's not investing in productive capacity or anything useful. They are aiming to push up the share price.
I'm not a banker, but both are investing in a financial asset, rather than in productive capex, to increase their share price. I don't see such a big difference.
If you asked your CEOs if they wish they had invested in bitcoin rather than in buying back their own shares you might not get the answer you are assuming.