Spending cash on share buy-backs boosts earnings per share immediately, whereas a capital-investment programme may actually reduce earnings in the short term.

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These determinations are based on their own proprietary research and on publically-available information on share buy-backs in the marketplace.

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The corporate sector is still increasing profits and churning out cash in the form of dividends and share buy-backs.

ECONOMIST: Buttonwood

Whether buy-backs should boost the share price of the average company is another tricky question.

ECONOMIST: Buttonwood

The companies with the strongest balance sheets will likely buy back their own shares, which is good for equity holders as buy backs mean more demand and more demand for equities means higher share prices.

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