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When should a company buy back stock?

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Question added by Shahbaz Hayder , Group Head of Finance , Sharif Group of Companies
Date Posted: 2015/04/25
Hamid Azhar
by Hamid Azhar , Intern , Pakistan Credit Rating Agency (PACRA)

Company should buy back stock when there are huge retain earnings and company dont have further plan for investment.By doing this company will try to reduce its shares in market lead to more earning per share to its shareholders,also it prevent other companies to have control of company. Company will also buy back shares to show its share demand in market thus leading to increase in share price. 

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