10. Stock repurchases There are a number of reasons why a firm might want to repurchase its own stock. Read the statement and then answer the corresponding question about the company's motivation for the stock repurchase: Big Walnut Nut Company is a high-tech company that recently repurchased a number of shares so that it will be able to meet obligations to employees without having to issue any new shares. What is the company's motivation for the stock repurchase? To protect against a takeover attempt To acquire shares needed for employee options or compensation To distribute excess funds to stockholders To adjust the firm's capital structure Which of the following statements would be considered advantages of a stock repurchase? Check all that apply. A stock repurchase can be used to minimize the dilution effect associated with employees exercising their stock options. Stock repurchases allow a firm to distribute earnings to investors without changing the amount of the regular cash dividend. The interval between stock repurchases tends to be irregular, which means that investors cannot always count on cash inflows from repurchases