It's like if you had 6 people who owned a pizza restaurant and one of them was the CEO. One day he calls a meeting and says, "Great news! I went to the bank to take out a loan, and paid Bob and Fred to buy their shares out. Now, as long as we continue to make a profit, we'll each make 50% more on our investment, the only catch is we have this debt hanging over our heads, and have to pay interest on that. Of course, if we start to lose money, your investment will lose out 50% quicker, but we won't talk about that. Also, I had to pay Bob and Fred enough that, in their opinion, it was more profitable to take the cash than own the company."
The only thing this does for the investor is make their investment more volatile. It's the same effect as if you opened an account at a brokerage, bought one stock, and took out margin so you could own more shares. Only the company is basically forcing you to take on margin in this way.
It's possible that it may make sense in some situations to do this, but given that it's so popular, I think the real reason is slight of hand.
The EPS goes up and the stock price goes up to a premium compared to the rest of the market. Take anybody that's not doing their DD, by either using a system, such as "dogs of the dow", or buying an index fund or simply choosing stocks at random. If you can sell your stock at a higher price, you make more money per share sold, and since these investors basically can't tell shit from shinola, you might as well sell them at the shittiest price you can manage.
If what I'm thinking is true, its somewhat hilarious that common wisdom is index funds and systems like "dogs of the dow" are commonly espoused as the best investments for new investors.