why would a company do a buyback 
a buyback allows a company to invest in itself more of its shares will wind up in the company s hands if a company feels that its shares are undervalued it may do a buyback to reward investors by repurchasing shares it reduces available open market shares making each worth a greater percentage of the corporation companies with cash on hand can use buybacks for employees and management compensation purposes using the shares for employee stock options the buyback helps avoid the dilution of existing shareholders finally a buyback can be a way to prevent a major shareholder from acquiring a controlling stake and launching a takeover bid 12