Comment on Apple Is Now More Than Double the Size of Exxon–And Everyone ElseparentComments−tinkerrr11yWhen a company buys back shares, the number of outstanding shares decreases. That's the whole reason for buying back shares. See http://www.investopedia.com/articles/investing/112013/impact... for a basic introduction to share buybacks.−coralreef11yI see, so even if outstanding shares is reduced, each share becomes "more valuable" as EPS will improve. So perhaps the market cap will end up balancing itself out?
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When a company buys back shares, the number of outstanding shares decreases. That's the whole reason for buying back shares. See http://www.investopedia.com/articles/investing/112013/impact... for a basic introduction to share buybacks.
I see, so even if outstanding shares is reduced, each share becomes "more valuable" as EPS will improve. So perhaps the market cap will end up balancing itself out?