S&P DJI: S&P 500 Q3 Buybacks Increases 14.5% Over Q2 2015, Up 3.7% Year-Over-Year

Companies Set Quarter and 12-Month Records for Returns to Shareholders

Dec 21, 2015, 10:52 ET from S&P Dow Jones Indices

NEW YORK, Dec. 21, 2015 /PRNewswire/ -- S&P Dow Jones Indices ("S&P DJI") announced today that preliminary results show that S&P 500® Q3 2015 stock buybacks, or share repurchases, increased 14.5% to $150.6 billion, up from the $131.6 billion posted in Q2 2015. Year-over-year comparison shows that share repurchases have increased 3.7% over the $145.2 billion reported during the third quarter of 2014.

Historical S&P 500 buyback data can be found at: www.spdji.com/indices/equity/sp-500

According to S&P Dow Jones Indices:

  • The $150.6 billion Q3 spend represents a 14.5% increase from the $131.6 billion spent during Q2 2015, and a 3.7% increase over the expenditure of Q3 2014.
  • For the 1-year period ending September 2015, S&P 500 issues increased their buyback expenditures by 1.6% to $558.9 billion from $550.1 billion posted in the prior 12-month period.
  • For the seventh consecutive quarter, over 20% of the S&P 500 issues reduced their year-over-year diluted share count by at least 4%, therefore boosting their earnings-per-share (EPS) by at least 4%.
  • The buyback high mark quarter was reached in Q3 2007, when companies spent $172.0 billion.
  • The recession quarterly buyback low point was $24.2 billion, recorded in Q2 2009. 
  • Total shareholder return, dividends plus buybacks, set a 12-month record, at $934.8 billion.

"As third quarter prices declined the most in four years, companies took advantage of the levels to increase their buybacks to reduce share count, and therefore add to their EPS at a time when EPS growth has faltered," says Howard Silverblatt, Senior Index Analyst at S&P Dow Jones Indices. "At this point, 14.6% of the S&P 500 issues have a current share count level at least 4% lower than their Q4 2014 level, meaning that those issues have already front-loaded at least a 4% tail wind to their Q4 2015 EPS."

Additionally, S&P Dow Jones Indices' data shows:

  • Issues reducing their share count this quarter was basically flat, with 306 doing so in Q3, down from 307 in Q2, but up substantially from the 257 in Q3 2014.
  • Significant changes (generally considered 1% or greater for the quarter) remained strong, and increased  for the third quarter, as 138 issues reduced their share count by at least 1%, compared to last quarter's 115, and the 101 in Q3 2014. 
  • Year-over-year share count reduction change impacts of at least 4%, which can be seen in EPS comparisons, increased for the third consecutive quarter, as 113 reduced, up from the Q2's 105, the Q1's 104, and the 99 posted in Q3 2014.

Total Shareholder Returns:

Silverblatt notes that total shareholders' return through regular cash dividends, as well as buybacks, increased to a record $245.7 billion or 8.7% over the $226.0 billion in Q2 2015, as dividends posted their eighth consecutive quarter of record payments. For the trailing 12-month period, companies returned a record $934.8 billion in buybacks and dividends to investors, surpassing the prior record of $923.3 billion, set in Q2 2015.

Silverblatt stated that cash reserves declined 1.4% during the third quarter as S&P 500 Industrial (Old) available cash and equivalent decreased to $1.30 trillion, from the second quarter's $1.32 trillion, and was 2.1% below the record $1.33 trillion set at the end of 2014. 

"High levels of shareholder return are now part of norm, with dividend increases almost assumed for non-commodity issues, and buybacks, while receiving bad-press, are expected to continue," comments Silverblatt. "Companies continue to have the resources to support these expenditures via cash-flow and still low financing rates. However, given that the Fed has now started to increase interest rates, debt financing will become more expensive, albeit slowly, putting pressure on buybacks. Cutting or limiting buybacks may not be a welcome move for investors, but scaling back dividends is typically a road that management avoids at high costs."

Sectors:

On a sector basis, Information Technology continued to dominate buybacks as their percentage of the Q3 buybacks increased to 28.7% from 27.9% in Q2. Energy maintained its low level, slightly increasing 0.9% for the quarter, as the sector continued to cut back on expenditures. Consumer Staples and Consumer Discretionary posted increases of 27.7% and 20.9%, respectively. Financials, accounting for 17.1% of all buybacks, increased 21.0% in Q3.

For the quarter Apple (AAPL) continued to lead with $13.3 billion spent on share repurchases, up 32.5% from their $10.0 billion Q2 expenditure – the fifth largest posted by an index issue in buybacks history (Apple also owns the first, second and third positions). Microsoft (MSFT) came in second with $4.8 billion, after buying back $4.3 billion in shares in the second quarter, followed by American International Group (AIG) with $3.7 billion, up from $2.3 billion. Walt Disney (DIS) and Gilead Sciences (GILD) rounded out the top-five buyback spenders.  Exxon Mobile (XOM) ranked 84th, with $0.5 billion, compared to $3.0 billion in the Q3 2014, when it ranked fourth.

For more information, please visit www.spdji.com

 

 

S&P Dow Jones Indices










S&P 500, $ U.S. BILLIONS










PERIOD

MARKET

OPERATING

AS REPORTED





DIVIDEND &

DIVIDENDS


VALUE

EARNINGS

EARNINGS

DIVIDENDS

BUYBACKS

DIVIDEND

BUYBACK

BUYBACK

& BUYBACKS


$ BILLIONS

$ BILLIONS

$ BILLIONS

$ BILLIONS

$ BILLIONS

YIELD

YIELD

YIELD

$ BILLION

9/30/2015 Prelim.

$16,917

$224.23

$205.90

$95.07

$150.58

2.22%

3.30%

5.53%

$245.66

6/30/2015

$18,219

$230.84

$201.35

$94.45

$131.56

2.03%

3.04%

5.07%

$226.01

3/31/2015

$18,303

$228.45

$193.05

$93.55

$144.13

1.98%

2.94%

4.92%

$237.69

12/30/2014

$18,245

$237.14

$202.31

$92.80

$132.63

1.92%

3.03%

4.95%

$225.43

9/30/2014

$17,519

$262.92

$244.00

$89.02

$145.19

1.96%

3.14%

5.10%

$234.22

6/30/2014

$17,404

$260.50

$240.96

$86.65

$116.17

1.91%

3.06%

4.98%

$202.82

3/31/2014

$16,700

$243.67

$221.82

$81.96

$159.28

1.93%

3.20%

5.14%

$241.24

12/31/2013

$16,495

$252.10

$236.31

$84.98

$129.41

1.89%

2.88%

4.77%

$214.40

9/30/2013

$14,960

$239.50

$219.13

$79.26

$128.16

2.05%

2.98%

5.03%

$207.42

6/30/2013

$14,310

$234.84

$221.56

$76.67

$118.05

2.07%

2.94%

5.02%

$194.72

3/31/2013

$13,979

$229.57

$215.76

$70.86

$99.97

2.06%

2.97%

5.02%

$170.82

12/31/2012

$12,742

$206.84

$184.50

$79.83

$99.15

2.20%

3.13%

5.33%

$178.98

9/30/2012

$12,881

$214.58

$189.64

$69.48

$103.72

2.07%

3.01%

5.08%

$173.20

6/30/2012

$12,303

$229.69

$195.27

$67.31

$111.75

2.08%

3.27%

5.35%

$179.05

3/31/2012

$12,730

$219.09

$208.15

$64.07

$84.29

1.95%

3.14%

5.09%

$148.37

12/31/2011

$11,385

$214.83

$186.85

$65.89

$87.59

2.11%

3.56%

5.67%

$153.47

09/30/2011

$10,303

$230.30

$206.08

$59.20

$118.41

2.22%

3.92%

6.14%

$177.61

6/30/2011

$12,021

$226.29

$202.44

$59.03

$109.24

1.84%

3.04%

4.88%

$168.27

3/31/2011

$12,068

$205.34

$195.15

$56.08

$89.84

1.76%

2.76%

4.52%

$145.91

12/31/2010

$11,430

$199.40

$187.67

$54.85

$86.36

1.80%

2.61%

4.42%

$141.21

09/30/2010

$10,336

$195.28

$176.80

$51.26

$79.56

1.94%

2.52%

4.45%

$130.81

06/30/2010

$9,323

$189.04

$178.00

$50.44

$77.64

2.10%

2.31%

4.41%

$128.08

03/31/2010

$10,560

$175.00

$157.85

$49.28

$55.26

1.83%

1.54%

3.36%

$104.54

12/31/2009

$9,928

$152.77

$135.14

$49.04

$47.82

1.97%

1.39%

3.36%

$96.86

09/30/2009

$9,337

$139.37

$130.37

$47.21

$34.85

2.24%

1.48%

3.71%

$82.06

06/30/2009

$8,045

$120.85

$118.22

$47.63

$24.20

2.77%

2.40%

5.17%

$71.83

03/31/2009

$6,928

$87.78

$65.29

$51.73

$30.78

3.43%

3.70%

7.13%

$82.51

 

S&P Dow Jones Indices










S&P 500 SECTOR BUYBACKS










SECTOR $ MILLIONS

Q3,'15

Q2,'15

Q3,'14

12 MO 9/15

12 MO 9/14

5-YEARS

2007 YR

Q2,'09

Q3,'07








(high)

(low)

(high)

Consumer Discretionary

$27,292

$22,568

$21,327

$91,931

$76,987

$371,969

$80,435

$2,350

$34,902

Consumer Staples

$9,884

$7,739

$9,970

$40,313

$41,839

$223,112

$51,589

$4,013

$16,088

Energy

$3,579

$3,547

$8,810

$22,974

$42,853

$185,242

$67,031

$5,343

$14,717

Financials

$25,737

$21,276

$20,441

$88,909

$72,110

$308,353

$107,328

$1,170

$27,762

Healthcare

$14,835

$18,131

$13,930

$68,967

$59,491

$315,277

$63,775

$4,699

$18,660

Industrials

$22,991

$17,172

$16,498

$75,821

$67,414

$259,795

$54,806

$1,681

$17,521

Information Technology

$43,161

$36,674

$42,906

$146,857

$157,185

$572,879

$121,974

$4,757

$23,904

Materials

$2,396

$2,395

$10,866

$14,195

$27,070

$63,064

$13,586

$159

$6,503

Telecommunication Services

$324

$166

$286

$5,767

$4,403

$36,300

$17,627

$13

$3,947

Utilities

$387

$1,894

$158

$3,177

$702

$9,501

$10,963

$10

$7,943

TOTAL

$150,583

$131,562

$145,193

$558,912

$550,053

$2,345,492

$589,113

$24,195

$171,947

 

S&P Dow Jones Indices








S&P 500 20 LARGEST Q3 2015 BUYBACKS, $ MILLIONS






Company 

Ticker

Sector

Q3,'15

12-Month

5-YEAR

10-YEAR

Indicated




Buybacks

Buybacks

Buybacks

Buybacks

Dividend




$ Million

$ Million

$ Million

$ Million

$ Million

Apple

AAPL

Information Technology

$13,253

$35,253

$103,113

$103,468

$11,862

Microsoft

MSFT

Information Technology

$4,757

$16,312

$44,061

$125,281

$11,517

American International Group

AIG

Financials

$3,730

$8,972

$26,042

$33,082

$1,449

Walt Disney

DIS

Consumer Discretionary

$3,272

$6,095

$24,717

$42,922

$2,397

Gilead Sciences

GILD

Healthcare

$3,050

$8,052

$15,647

$23,055

$2,524

Biogen

BIIB

Healthcare

$2,956

$3,525

$5,768

$12,647

$0

Oracle

ORCL

Information Technology

$2,916

$9,003

$38,609

$51,599

$2,602

McDonald's

MCD

Consumer Discretionary

$2,392

$5,665

$16,051

$30,984

$3,353

QUALCOMM

QCOM

Information Technology

$2,230

$11,246

$21,487

$27,725

$3,017

Comcast

CMCSA

Consumer Discretionary

$2,185

$7,771

$17,470

$28,398

$2,462

Wells Fargo

WFC

Financials

$2,137

$9,668

$27,847

$39,960

$7,700

Motorola Solutions

MSI

Information Technology

$2,058

$4,419

$10,234

$17,590

$290

Home Depot

HD

Consumer Discretionary

$1,958

$6,465

$28,677

$48,554

$3,030

Citigroup

C

Financials

$1,952

$4,608

$7,705

$21,102

$602

Twenty-First Century Fox

FOXA

Consumer Discretionary

$1,889

$6,555

$16,920

$20,113

$366

Cisco Systems

CSCO

Information Technology

$1,592

$4,988

$28,319

$65,412

$4,272

International Business Machines

IBM

Information Technology

$1,543

$3,940

$56,717

$114,038

$5,094

3M

MMM

Industrials

$1,523

$5,383

$20,312

$28,533

$2,561

Boeing

BA

Industrials

$1,500

$7,002

$13,803

$20,819

$2,473

Caterpillar

CAT

Industrials

$1,500

$2,025

$8,263

$16,321

$1,856

Top 20  



$58,393

$166,947

$531,762

$871,603

$69,427

S&P 500



$150,583

$558,912

$2,345,492

$4,160,460

$401,227

Top 20 % of S&P 500



38.78%

29.87%

22.67%

20.95%

17.30%

   Gross values are not adjusted for float







 

S&P Dow Jones Indices





S&P 500 Q3 2015 Buyback Report









SECTOR

DIVIDEND

BUYBACK

COMBINED



YIELD

YIELD

YIELD


Consumer Discretionary

1.63%

4.01%

5.64%


Consumer Staples

3.11%

2.21%

5.32%


Energy

3.57%

1.95%

5.53%


Financials

2.16%

3.06%

5.21%


HealthCare

1.69%

2.60%

4.29%


Industrials

2.39%

4.33%

6.72%


Information Technology

1.73%

4.15%

5.88%


Materials

2.44%

2.87%

5.31%


Telecommunication Services

5.28%

1.36%

6.64%


Utilities

4.07%

0.60%

4.66%


S&P 500

2.28%

3.19%

5.47%


   Uses full values (unadjusted for float)




   Dividends based on indicated; buybacks based on the last 12-months ending Q3,'15

 

About S&P Dow Jones Indices
S&P Dow Jones Indices LLC, a part of McGraw Hill Financial, is the world's largest, global resource for index-based concepts, data and research. Home to iconic financial market indicators, such as the S&P 500® and the Dow Jones Industrial Average®, S&P Dow Jones Indices LLC has over 115 years of experience constructing innovative and transparent solutions that fulfill the needs of investors. More assets are invested in products based upon our indices than any other provider in the world. With over 1,000,000 indices covering a wide range of asset classes across the globe, S&P Dow Jones Indices LLC defines the way investors measure and trade the markets. To learn more about our company, please visit www.spdji.com.

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