Treasury stock definition

Treasury stock is the portion of a company’s shares that it keeps in its own treasury. The shares do not count towards the total amount of outstanding shares listed, and neither pay dividends nor carry voting rights (because a company cannot pay itself, or own itself).

Typically, treasury stock is either kept back from the public when a company lists, or bought back from shareholders as part of a buyback. A buyback reduces the number of available shares in a company and can have the effect of driving up its share price.

If a company is holding treasury stock, it can be found listed on the equity part of its balance sheet.

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