S&P 500 Firms Spent $161.4 Billion on First-Quarter Share Buybacks
June 22 2016 - 3:40PM
Dow Jones News
Companies in the S&P 500 spent $161.4 billion buying back
shares in the first quarter of 2016, the second-largest amount on
record, supporting stock prices amid the index's early-year
drop.
Buybacks in the first quarter increased 12%, compared with the
$144.1 billion spent in the first quarter of 2015, according to
preliminary results from S&P Dow Jones Indices. For the 12
months ending in March 2016, S&P 500 companies spent a record
$589.4 billion, beating the $589.1 billion spent in 12 months
through December 2007.
The increase in buybacks comes as cash reserves for companies in
the S&P 500 Industrials set a record of $1.347 trillion as of
the first quarter, up 1.1% from the prior record of $1.333 trillion
set at the end of 2014, said Howard Silverblatt, senior index
analyst. That excludes some companies such as financial, utilities
and transportation firms that are required to hold cash for various
reasons.
"Companies did make good on their word," he said, noting
buybacks were likely to continue to increase. "They still have the
opportunity to borrow at extremely cheap rates, they have record
amounts of cash on their books and they have outside pressure on
them, because when activists see this cash, they want it."
Including both dividends and buybacks, total shareholder returns
hit a record $257.6 billion in the first quarter of 2016, and a
12-month record of $974.6 billion for the 12 months ending in
March.
Health-care companies increased their buybacks 86%, to $30.6
billion, up from $16.5 billion the prior quarter, S&P found.
That was led by $8 billion from Gilead Sciences Inc.—the 18th
largest buyback in the index's history.
Information technology continued to lead buybacks and cash
holdings, even as the sector's percentage of the total decreased to
22% from 24% in the last quarter of 2015. Apple Inc. spent the
second-most on buybacks, with $6.7 billion.
Buybacks in the energy sector posted a 21% quarterly decline, to
$2.1 billion. That is down 63% from the first quarter of 2015.
Write to Aaron Kuriloff at aaron.kuriloff@wsj.com
(END) Dow Jones Newswires
June 22, 2016 15:25 ET (19:25 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
Apple (NASDAQ:AAPL)
Historical Stock Chart
From Aug 2024 to Sep 2024
Apple (NASDAQ:AAPL)
Historical Stock Chart
From Sep 2023 to Sep 2024