HJ Corporation has excess cash and has opted to buy some of its shares of outstanding common stock.What is this process of buying called?

Question

Quizplus · Accepted Answer

The process of buying a company's own shares of outstanding common stock is called a stock repurchase or share buyback. This allows the company to invest excess cash and reduce the number of outstanding shares, which can increase the value of the remaining shares for shareholders. Stock dividends and stock splits involve distributing more shares to current shareholders, while stock recapitalization and stock repeal are not commonly-used terms in finance.

HJ Corporation Has Excess Cash and Has Opted to Buy