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 often results in the stock price rising in the short term due to the reduction in the number of outstanding shares, which increases earnings per share. However, the long-term effects are uncertain as it depends on how the company uses the Treasury shares – if they are reissued, it dilutes the ownership percentage of current shareholders, but if they are retired permanently, it can improve earnings per share and return on equity.

What Are the Effects of a Company Repurchasing Its Own