More companies are turning to buybacks in a bid to please shareholders, and there is evidence that buybacks are rewarding in terms of outperforming the broader stock market. Money spent on buybacks does mean money not spent on research, people and acquisitions, but companies are viewed as pessimistic about investment opportunities. "Given that they're not expecting a lot of growth, there isn't a lot of reason to invest. So they're finding ways of getting money back to shareholders," said Ben Inker of investment-management firm GMO.

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