Definition of Buyback:
A buyback allows companies to invest in themselves. Reducing the number of shares outstanding on the market increases the proportion of shares owned by investors. A company may feel its shares are undervalued and do a buyback to provide investors with a return. And because the company is bullish on its current operations, a buyback also boosts the proportion of earnings that a share is allocated. This will raise the stock price if the same price-to-earnings (P/E) ratio is maintained.
A buyback, also known as a share repurchase, is when a company buys its own outstanding shares to reduce the number of shares available on the open market. Companies buy back shares for a number of reasons, such as to increase the value of remaining shares available by reducing the supply or to prevent other shareholders from taking a controlling stake.
Securities: Offer by a firm to repurchase its own shares from the shareholders to (1) to raise the stocks price, (2) remedy over-capitalization, or (3) defend itself against a hostile takeover attempt.
Exporting: Counter-trade arrangement in which an exporter (of tire making machinery, for example) agrees to buy a specified portion of the manufactured goods (tires, in this example) as an incentive to the buyer.
The buying back of goods by the original seller.
How to use Buyback in a sentence?
- Instead, they want to continue to chase new subscribers and growth, and if there is anything left for afters, to spend it on buy-backs rather than special payouts.
- A repurchase reduces the number of shares outstanding, thereby inflating (positive) earnings per share and, often, the value of the stock. .
- A share repurchase can demonstrate to investors that the business has sufficient cash set aside for emergencies and a low probability of economic troubles.
- A buyback is when a corporation purchases its own shares in the stock market.
Meaning of Buyback & Buyback Definition