GM's Rumored Stock Buyback Is Short-Term Thinking

Wilson, who represents Tepper?s Appaloosa Management and three other Hedge Funds that own 2.1% of the company?s stock, plans to convince GM to buyback $8 billion worth of stock. The move is consistent with the recent trend of a number of activist investors entering companies and pressuring them to buy back stock in order to profit from the potential rally in market price (by reducing the number of shares, there is an increased allocation of revenue and earnings to each outstanding share.