Stock Market, companies are buying back their shares, results???

My personal view is that if a company thinks that the best thing they can do with extra money is buy back their own stock then they're no longer a "growth" stock (in which most, if not all, of the return comes from capital growth) and are instead an "income" stock (where dividends provide the majority of the return). That's not to say that they're no longer a stock to own, just that they are now in a different phase of their lifecycle.

 

Stock buybacks IMO are also a way to avoid paying higher dividends...the company can just spend a ton of cash on dividend payments none of which will provide the benefits of stock buybacks. Stock buybacks won't provide cash in hand to shareholders but it can sustain and/or increase stock values. Apple Inc. is a good example of a growth stock that does stock buybacks and pays dividends...they have a ton of cash plus just repatriated billion$ with the recent GOP tax changes. Sometimes a company can use stock buybacks to reduce outstanding shares thereby increasing the 'earnings per share' ratio but this is just one of those games encouraged by being a public company with constant shareholder demands...