company-buyback-strategy

Vocabulary Word

Definition

'Company buyback strategy' means a company is buying back its own shares from the stock market, often done when the company has extra money and believes its shares are undervalued.

Examples in Different Contexts

In investor relations, a 'company buyback strategy' is often communicated as a positive move that reflects the company's strong cash position and optimism about the future. An investor relations officer might state, 'Our buyback strategy demonstrates our fiscal health and our belief in the company's growth prospects.'

Practice Scenarios

Finance

Scenario:

The market perception of our shares does not seem to reflect their true worth. We need to send a positive signal to investors.

Response:

Implementing a company buyback strategy could be a convincing way to show our confidence in the future of our shares.

Economics

Scenario:

If a company seeks to increase the price of its shares, it might look at alternatives to dividends for returning profits to shareholders.

Response:

A company buyback strategy could raise the price of shares by reducing their supply in the market.