Stock buybacks occur when a company purchases its own shares from the market. This action reduces the number of outstanding shares, which can increase the value of remaining shares and improve financial metrics like earnings per share. Companies often use buybacks to return excess cash to shareholders, signaling confidence in their financial health. Investors may view stock buybacks positively, as they can lead to higher share prices. However, critics argue that companies might prioritize buybacks over investing in growth opportunities or employee wages. Overall, buybacks are a common strategy used by companies to manage their capital and enhance shareholder value.