The conversation between human and AI assistant.
Does stock buyback affect Retained Earnings account in the balance sheet?
Okay, I see. Can't a company also issue more shares to raise capital instead of buying back its own stock?
Yes, a company can issue more shares to raise capital. However, a company may prefer to buy back its own stock rather than issue new shares because it shows more confidence in the company's future and can signal a positive outlook to the market. Additionally, buying back stock can be more tax-efficient than issuing dividends, which can also be a benefit to the company.