Comment by mdemare

No, this is incorrect. Investors like buybacks, so when the buyback is announced, share prices may rise, but certainly not by the amount of the buyback. They don't go up when the buyback gets executed, unlike dividends, which decrease the share price at the moment when they get distributed.

The equations are: nr_shares * share_price = cash_of_company + value_of_company_excluding_cash.

In a buyback, cash_of_company decreases by the buyback, and nr_shares decreases by buyback / share_price.

Consider the extreme case, a lemonade stand with a bank account with $1M. 1000 shares outstanding, share price $1000. After a buyback of $900K is announced, 900 shares are sold for $1000. $100K remains in the company's bank account, 100 shares remain outstanding, at ... $1000 per share.