Mostly it comes down to investor preference. For companies experiencing a high rate of growth and good long term ROI, many investors would prefer the company r

Mostly it comes down to investor preference. For companies experiencing a high rate of growth and good long term ROI, many investors would prefer the company reinvest the net revenue instead of paying dividends. Some investors prefer capital gains due to tax treatment (long term gains vs income tax). Many companies oblige this with stock buybacks.