Is a company buy back good for an investor?

A great question! Buybacks work well for existing shareholders under the following conditions in my opinion:

1) The company has surplus funds that it wishes to return to shareholders and it does not have enough attractive high return projects to undertake.

2) The stock is trading in the open market at a price that is less than its "intrinsic value" Intrinsic value is a concept that is used by value investors such as Warren Buffett and originally by Benjamin Graham. This concept works because you increase the value of the remaining shares if you buy and effectively cancel some of the shares at a price below the intrinsic value. Think of it this way. If you have 100 quarters (starting value 25 cents each or total value of $25.00) and you are able to buy 10 of them for a dime each (total $1.00)you now have 90 quarters left with a total value of $24.00.

However, each quarter is now effectively worth $24.00/90 or 26.67 cents.

This is how buybacks work, if and only if something of greater value is being obtained for a cheap price.

The principal is simple: buy something of greater value for a cheap price.

But be careful, not all buybacks done on the stock exchange work. Many times they are there just to hold a stock price up for executive bonuses or exercising stock options. Many times, surplus funds of corporations get splurged on low return acquisitions where too high a price is paid just to build the empire.

Good luck!

For a current shareholder of the company - yes. It will raise your stock price because there is less outstanding stock on the market.

yes, buyback reduces the amount of outstanding stocks in the market so pershare price will rice and stock price will also rise.

it's a good thing when company buy back stocks.