Stock buybacks serve important purposes that are often overlocked when this topic comes up. One major purpose of stock buybacks is to reduce the company's cost

Stock buybacks serve important purposes that are often overlocked when this topic comes up. One major purpose of stock buybacks is to reduce the company's cost of capital. With debt financing being so cheap right now, we've seen fedex significantly increase it's long term debt. For fedex, using their cash to buy back stock improves their overall financial picture because even if they need to raise more debt to financing their business, their overall cost of capital actually decreased - because the carrying cost of debt is cheaper then equity!