What are the effects of a company repurchasing its own stock as Treasury shares?

Question

Quizplus · Accepted Answer

Repurchasing its own stock as Treasury shares usually leads to an increase in the stock price in the short term, as the reduced supply of shares can increase demand and create a perception of value. However, the long-term effects are uncertain and depend on factors such as the company's financial performance and future prospects. Additionally, some investors may view stock buybacks as a signal that the company lacks profitable investment opportunities or is prioritizing shareholder returns over reinvestment in the business. Therefore, while the short-term effects are usually positive, the long-term effects are uncertain.

What Are the Effects of a Company Repurchasing Its Own