Which of the following strategies can a company pursue to increase its stock price?

Repurchasing its own shares is a strategy that companies often use to increase their stock price. When a company buys back its own shares, it reduces the total number of outstanding shares, which can lead to an increase in earnings per share (EPS) and a more favorable perception among investors. As the number of shares available in the market decreases, the value of the remaining shares typically increases, boosting the stock price.

Additionally, share repurchases can signal to the market that the company believes its stock is undervalued, instilling confidence in investors. This action may also reflect the company’s strong cash flow position, leading to further positive investor sentiment. Consequently, this strategy aligns with enhancing shareholder value directly through market actions, making it a well-recognized approach for boosting stock prices.

In contrast, issuing more stocks can dilute current shares, potentially decreasing their value. Increasing debt levels might raise concerns about the company’s financial stability, while reducing production costs without affecting quality is a positive operational strategy but does not directly impact the stock price in the short term like share repurchases do.