Although not everyone agrees with me, buybacks remain one of my favorite "dividend alternatives" for benefiting from the cash profits of the profitable businesses I invest in. In some ways, buybacks act as automatic dividend reinvestment plans, and are especially advantageous to taxable or foreign investors who would otherwise need to pay or have withheld a significant tax drag before reinvesting dividends. Although investors who live off their dividends may not find the increase in the percentage of the company they own as tangible as a cash dividend, a diversified portfolio even for income investors