The truth about record-high stock buybacks 💸

They're actually not that high

One of the more controversial decisions a corporation will make is to buy back shares of its own stock.¹

So for some folks, it’s triggering to read headlines like these:

• “Companies Plan to Pour Even More Cash Into Buybacks, Dividends in 2022” - WSJ, 12/22/2021

• “U.S. Share Buybacks Hit Record While Capex Lags Pre-Crisis Level” - Bloomberg, 12/21/2021

• “Stock buybacks can keep surging next year after a potential record for 2021, analysts say” - MarketWatch, 12/18/2021

According to data compiled by S&P Dow Jones Indices senior index analyst Howard Silverblatt, S&P 500 companies spent a record $234.6 billion on buybacks in Q3.

From a dollar perspective, buybacks are at record highs. (Source: Howard Silverblatt)

However, you if don’t click into these stories and read the analysis that puts these numbers into context, you’ll miss a critical part of the story.