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Firms deciding to make large increases in their dividend payouts or starting a stock repurchase program is dictated by the strategic goals for the company.  If the company is looking to reinvest in the firm and start new initiatives, then paying out a dividend would not be beneficial to the company.   A company deciding to repurchase shares of stock from investors reduces the number of outstanding shares and enables the remaining shares to be more valuable.  Before making either decision, the strategic vision for the company must be understood and how to ensure growth and success for the company in the future.  According to Frankel (2018), there are two main ways that companies can return profits to shareholders; dividends and share buybacks. And while the idea behind both ways is to give money back to investors, the best method depends on a few things, such as the company’s goals, valuation of the stock, and the investor’s personal goals.  Before making any decision about which method to use, either dividend or stock repurchase, the company needs to ensure that all capital needs are met and that initiatives planned for future growth have the correct amount of resources allocated.  For example, Apple Inc. does not pay out dividends, nor do they have a stock repurchase program; they sit on their profits.  Compiling a cash reserve, Apple ensures that if they need capital in the future, they have enough cash to cover the necessity.