What Is A Buyback?

Patrick Curtis

Reviewed by

Patrick Curtis WSO Editorial Board

Expertise: Investment Banking | Private Equity

A buyback is a corporate action undertaken by a firm where it repurchases some of its shares outstanding from the market. This is done for one of 3 reasons:

  • Increase the value of the shares (less supply, same demand = higher price).
  • Invest in themselves; owning more shares in the company allows them to experience a higher percentage of the profits.
  • Reduce the threat of any takeover by reducing the percentage of the company which is up for sale on the markets.

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Patrick Curtis is a member of WSO Editorial Board which helps ensure the accuracy of content across top articles on Wall Street Oasis. He has experience in investment banking at Rothschild and private equity at Tailwind Capital along with an MBA from the Wharton School of Business. He is also the founder and current CEO of Wall Street Oasis This content was originally created by member WallStreetOasis.com and has evolved with the help of our mentors.