> ? In the process of buying shares back, the market capitalization would increase due to the increase in share price. The share price would absolutely move. Th

> ? In the process of buying shares back, the market capitalization would increase due to the increase in share price. The share price would absolutely move. This is why companies have stock buy-backs, in order to pump up the share price. Market cap is the multiple of shares outstanding vs share value. The number of shares would go down, but the market cap would also go down. You just spent a lot of money. Also, the value of the company would go down because its cash equivalents would go down by the amount it spent on the buyback. The buyback is the equivalent of a dividend. Every time a company gives a dividend, the stock price goes down by the amount of dividend it gives out. > but even then I don't think it would be so simple, as that 100B in shares would now be listed as assets to the company and could be used as remuneration for the employees, among other things. Incorrect. From: http://www.investopedia.com/articles/02/041702.asp http://www.investopedia.com/articles/02/041702.asp The idea is simple: because a company can't act as its own shareholder, repurchased shares are absorbed by the company, and the number of outstanding shares on the market is reduced