Tuesday, April 08, 2008

Stock Buybacks In 2007 Were At A High Level But On The Decline

Standard & Poor's reported stock buybacks were at a fairly high level in 2007. Total buybacks for the year equaled an estimated $589 billion. This compares to total buybacks in 2006 of $432 billion.
  • reported earnings of $68.53 billion represented a declined of 62% versus $181.65 billion reported in 2006.
  • dividends in the quarter increased 8.6% to $67.1 billion dollars versus $61.8 billion recorded in the fourth quarter of 2006.
In S&P's buyback press release it was noted there has been a shift in which sector is leading in the buyback activity.
"Financial issues continue to pull back on buybacks, accounting for just 13.4% of the aggregate repurchases during the fourth quarter of 2007 compared to 22.3% during the fourth quarter of 2006," adds Howard Silverblatt. "Information Technology remained the prime player in the buyback market, with 22.5% of the buybacks, partially due to their use of options to supplement employee salaries."

(click on chart for larger image)

stock buyback chart December 31, 2007
S&P 500 Buybacks Set Record of $589 Billion in 2007
Standard & Poor's
By: Howard Silverblatt & David R. Guarino
April 7, 2008

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