Treasury Stock Shares, formerly outstanding, that were repurchased by the issuing company. Companies often repurchase stock to benefit existing shareholders. Those who sell receive a premium price from the company for their shares, thus substituting a large capital gain for future dividends. This ploy is used when dividend taxes are higher than capital gains taxes. Remaining investors who keep their shares benefit from a tightened supply, which raises the share price. Companies may later resell treasury stock, or retire it according to a shareholder vote.