> On the other hand, a buyback should lower the market cap of a stock [...]
Uhh...what?
Buybacks are a return of value. Share prices adjust accordingly to the updated proportion of outstanding stock.
Might want to select a new username, friend.
Uhh...what?
Buybacks are a return of value. Share prices adjust accordingly to the updated proportion of outstanding stock.
Might want to select a new username, friend.
That said, this is all under a theoretical model (as in Miller-Modigliani theorem). In practice/empirically, there is reason to plausibly believe that e.g. the decision to announce a buyback has a signalling effect and so can increase share prices.