Some Perspective on Buybacks Given Recent Criticism

Buybacks have been put back into the spotlight as boogeymen. Earlier this week, Senators Chuck Schumer and Bernie Sanders wrote an op-ed in The New York Times attacking share repurchases. Among their accusations were that stock buybacks mostly benefit the wealthy and divert money from being spent on capital expenditures, salary increases and other worker benefits. It’s…

 

Common Stock Repurchases: A Bane or Boon to Shareholders?

Repurchases of common stock by corporations can be an attractive alternative to dividends. They may also affect share price. But what is their impact—to the corporation; to the shareholder? Many companies have been repurchasing their common stock in recent years and some can involve hundreds of millions or even billions of dollars. Investors who own…

 

Stock Buybacks Are Being Maligned

Stock buybacks have been the topic of discussion lately. Not from an investment strategy perspective, but more so from the perspective of what corporations should be doing with their cash. This is not surprising given the tax cuts, strong corporate earnings and the ongoing conversations surrounding worker pay. While some of the arguments may seem…

 

Companies Cut Share Buybacks

This week S&P Dow Jones Indices (S&P DJI) reported preliminary data indicating that S&P 500 stock buybacks (shares repurchases) fell 17.5% in the first quarter of 2017 to $133.1 billion from $161.4 billion in the first quarter of 2016. For the 12-month period ending March 2017, S&P 500 companies spent $508.1 billion on buybacks, down…