Tax cuts are fueling a record-setting boom in company share repurchases. But recent buybacks have left some investors feeling burned. Here’s why.

WE’RE MORE THAN NINE YEARS into a bull market, and it’s no secret that stocks are expensive. The Shiller price/earnings ratio, which compares companies’ share prices with their inflation-adjusted 10-year earnings average, is at 31, well above the historical median of 16—a sign that future returns will be sluggish. Combine that with simmering worries about trade wars and inflation, and you get a climate in which fewer investors are clicking the “buy” button.

Yet there’s one group purchasing company shares with gusto: the companies themselves. As the impact of new

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