Last week S&P Dow Jones Indices reported buyback and dividend results for the S&P 500 Index for the second quarter. For the second quarter buybacks increased 18.1% on a quarter over quarter basis and increased 5.6% year over year. Buybacks plus dividends for the second quarter totaled $194.72 billion. This level remains below the record set in the third quarter of 2007 when the combined buyback and dividend level reached $232.79 billion.
|From The Blog of HORAN Capital Advisors|
The one company with a notable buyback was Apple (AAPL). According to Howard Silverblatt, Senior Index Analyst at S&P Dow Jones Indices, "Apple spent $16 billion on buybacks in the second quarter, accounting for 13.5% of all buybacks in the period and setting a new index record for quarterly buybacks by surpassing International Businesses Machines' Q2 2007 expenditure of $15.7 billion." A couple of additional buyback facts in the second quarter report were:
- "Excluding Apple, the 18.1% Q2 increase in buybacks becomes 2.0%. If we adjust for the average stock price in Q2 being 6.3% higher than in Q1, the takeaway is that less shares were actually repurchased in Q2 than Q1, even as the headline, legitimately, reads 18%"
- "The Information Technology sector, with the help of Apple, easily maintained its dominance of buybacks, accounting for 31.5% of all expenditures, up from 19.6% in the first quarter. The Industrials sector increased its expenditures and percentage of buybacks, accounting for 12.2% of expenditures, up from 9.0% in the first quarter."
- "Of the 309 which reported buybacks, 252 companies paid a cash dividend, with their 12 month buybacks 42% higher than dividends."
Source: S&P Dow Jones Indices