>Unlike dividends, they don't return money to all shareholders,

That's false reasoning in so many level. Take every of your arguments and do counterfactual and you see.

> leads to perverse incentives and underinvestment

Investing is not alternative to paying dividends in any well managed company. Companies invest if they see better ROI for the investment than elsewhere. They give money back to shareholders (either dividends or buybacks) when they can't do better than markets.