If a firm has excess cash and management believes the firm's shares are currently undervalued by market participants, the firm is a likely candidate for a _________.

Question

Quizplus · Accepted Answer

When a firm has excess cash and believes its shares are undervalued, a stock repurchase (or buyback) is a common strategy. This allows the company to buy back its own shares from the marketplace, which can help increase the stock price by reducing the supply of shares available and sending a positive signal to the market that the company believes its stock is undervalued.

If a Firm Has Excess Cash and Management Believes the Firm's