Definition
Treasury stock represents shares bought back by the company and held in its treasury. These shares don't vote, receive dividends, or count toward EPS calculations. Companies may retire treasury stock or reissue it for employee compensation.
Formula
Treasury Stock (Contra-Equity) reduces Shareholders' Equity
Example
A company repurchased 10M shares at $30 average, creating $300M in treasury stock. This reduces shareholders' equity and shares outstanding for per-share calculations.
FAQ
What is Treasury Stock?
Company shares that have been repurchased and are held by the company.
How do you calculate Treasury Stock?
A common formula for Treasury Stock is: Treasury Stock (Contra-Equity) reduces Shareholders' Equity
Why is Treasury Stock important?
Treasury Stock helps investors evaluate financial statements and make more informed decisions.