Correct. This is another reason why buybacks are popular. On the other hand, some people might prefer to get steady income by default without having to liquidate periodically parts of their portfolio. And long term investors might not be happy when a company spends money buying back its shares at high valuations (of course they could sell if they think the shares are overvalued, but we are talking about long term investors).

There are other reasons than steady income that investors sometimes prefer dividends: 0. dividends force companies to be regimented about consistently creating income and not just sway with the overall market. 1. the shares are held in tax-deferred/tax-free accounts, so they taxable events don't matter to them. they prefer the tangible (dividend) to intangible (share increase from buyback)