Is share buy back a good thing?
why?
comment?
What makes a company decided to buy back their shares?

It means that the share of that company drop into attractive price!!

Share buy-back could mean a few possibilities:-

1. Company is looking towards privatisation

2. Fundamentally sound companies will buy-back if they think the investment is worth their retained profits

3. Company wants to pay out dividends in the form of treasury shares

4. Management wants to support the stock price

If the reasons are 1, 2 and 3, then it will only mean good thing. But if the reason is 4, we have to be wary.

thx.
but what is treasury shares?
how to differentiate whether which reason caused the company to buy back?

Treasury shares are shares bought and retained by companies which are not entitled to voting rights and dividends/bonuses. These are the shares distributed to shareholders when companies declare bonus.

We can't be sure of their reasons, but the most obvious way is by looking at its ROE. Good ROE would most probably mean reason 2.

If the company has been buying continuously and is reaching 50%, then you could almost be sure of reason 1.

If the share price has been decreasing rapidly due to disappointing data, then it would be reason 4.

If treasury shares are in the millions, then wait for their announcement for reason 3.

I see, thanks a lot for your information