S&P 500 First Quarter Buybacks Rebound 80%; Remain 76% Off Historical High

Jun 24, 2010, 10:48 ET from Standard & Poor's

NEW YORK, June 24 /PRNewswire/ -- Standard & Poor's, the world's leading index provider, announced today that preliminary results show that S&P 500 stock buybacks for the first quarter of 2010 increased 79.5% to $55.3 billion from the $30.8 billion registered during the first quarter of 2009. The $55.3 billion in share repurchases represents a 15.6% improvement over the fourth quarter of 2009, and marks the third quarter in a row that S&P 500 companies have increased their stock buyback activity.

"Companies have officially returned to the buyback market; however their purchases appear to be aimed at neutralizing employee options, and therefore are preventing earnings dilution," says Howard Silverblatt, Senior Index Analyst at S&P Indices. "Given the record amount of cash on their books, we expect the S&P 500 companies to continue this strategy, even if the market picks up from the current correction mode and puts more options in the money."

S&P Indices also determined that during the first quarter of 2010, 251 issues participated in stock buyback programs, up from the 214 that did so in the fourth quarter of 2009, and the 194 that participated in the first quarter of 2009. While there was broader participation, buybacks remained top-heavy with 20 issues accounting for 59.8% of the buyback activity. Additionally, for the fourth quarter in a row, none of the issues made the top 20 historical list for largest stock buybacks.

On a sector basis, S&P Indices notes that Information Technology remains the dominant player in the buyback field, accounting for 29.3% of all buybacks with Consumer Staples accounting for 19.3%. Both Telecommunications and Utilities were the only sectors to reduce their first quarter buyback expenditures.

Exxon Mobil, the long-term buyback leader, slightly increased its first quarter buyback activity ($2.50 billion from $2.37 billion), but remains 68.2% below its expenditures from a year ago ($7.85 billion); International Business Machinery spent the most on share buybacks during the first quarter ($4.02 billion), increasing its year-over-year quarterly repurchases by 128% (from $1.77 billion).

"For all of 2010, S&P Indices sees buyback growth and expenditures outpacing dividends throughout the year, but remaining well below the record pace set in 2007," concludes Silverblatt.

Historical S&P 500 buyback data can be found at: www.marketattributes.standardandpoors.com.

S&P Indices

S&P 500, $ U.S. BILLIONS

PERIOD

MARKET

OPERATING

AS REPORTED



DIVIDEND &


VALUE

EARNINGS

EARNINGS

DIVIDENDS

BUYBACKS

BUYBACK


$ BILLIONS

$ BILLIONS

$ BILLIONS

$ BILLIONS

$ BILLIONS

YIELD








03/31/2010

$10,560

$174.91

$157.94

$49.28

$55.26

3.38%

12/31/2009

$9,928

$152.77

$135.14

$50.40

$47.82

3.37%

09/30/2009

$9,337

$139.37

$130.37

$47.21

$34.85

3.71%

06/30/2009

$8,045

$120.85

$118.22

$47.63

$24.20

5.17%

03/31/2009

$6,928

$87.78

$65.29

$51.73

$30.78

7.13%

12/31/2008

$7,852

-$0.78

-$202.11

$62.19

$48.12

7.48%

09/30/2008

$10,181

$142.90

$86.16

$61.44

$89.71

6.73%

06/30/2008

$11,163

$148.43

$112.15

$61.94

$87.91

6.88%

03/30/2008

$11,511

$144.63

$135.24

$61.72

$113.90

7.25%

12/31/2007

$12,868

$133.38

$68.53

$67.09

$141.71

6.49%

09/30/2007

$13,470

$184.13

$133.66

$61.21

$171.95

5.89%

06/30/2007

$13,350

$213.65

$194.30

$59.76

$157.76

5.44%

03/31/2007

$12,706

$200.23

$190.75

$58.53

$117.70

5.35%



S&P Indices

S&P 500 SECTOR BUYBACKS

SECTOR $ MILLIONS



Q1,'10


Q1,'10

Q4,'09

Q1,'09

CHG OVR

CHG OVR

CHG FR





Q4,'09

Q1,'09

Q3,'07

Consumer Discretionary

$6,197

$5,146

$1,794

20.41%

245.41%

-82.24%

Consumer Staples

$10,678

$9,900

$3,942

7.86%

170.88%

-33.63%

Energy

$2,986

$2,655

$7,953

12.46%

-62.46%

-79.71%

Financials

$5,455

$3,142

$620

73.63%

779.57%

-80.35%

Healthcare

$9,395

$7,512

$7,728

25.08%

21.57%

-49.65%

Industrials

$3,304

$2,843

$2,358

16.19%

40.13%

-81.14%

Information Technology

$16,207

$15,253

$6,103

6.25%

165.55%

-32.20%

Materials

$735

$365

$241

101.35%

205.45%

-88.69%

Telecommunication Services

$70

$117

$29

-40.16%

137.58%

-98.23%

Utilities

$232

$885

$14

-73.77%

1511.83%

-97.08%

TOTAL

$55,259

$47,818

$30,783

15.56%

79.51%

-67.86%



S&P Indices

S&P 500 INDUSTRIAL (OLD) CASH AND EQUIVALENT LEVELS


YEAR

CASH &
EQUIVALENT

% HELD

SHORT-TERM

CASH % OF


$ MILLIONS

AS CASH

SECURITIES

MARKET





VALUE

03/31/2010

$836,771

67.10%

32.90%

10.14%

12/31/2009

$831,188

70.49%

28.85%

9.98%

9/30/2009

$820,287

68.28%

31.22%

10.70%

6/30/2009

$772,687

67.55%

32.10%

11.48%

3/31/2009

$664,778

72.20%

27.80%

11.08%

12/31/2008

$654,613

74.10%

25.40%

9.94%

9/30/2008

$647,813

74.63%

25.37%

7.79%

6/30/2008

$648,436

74.73%

25.27%

7.04%

3/31/2008

$615,504

72.41%

27.12%

6.67%

12/31/2007

$609,664

69.84%

29.79%

5.93%

9/28/2007

$622,800

68.40%

31.10%

5.96%

6/30/2007

$602,968

67.14%

32.62%

5.90%

03/30/2007

$606,571

66.70%

33.09%

6.33%



S&P Indices

S&P 500 20 LARGEST Q1 2010 BUYBACKS, $ MILLIONS

COMPANY

SECTOR

Q1 2010

BUYBACKS




Q4,'04-Q1,'10

Int'l Business Machines Corp

Information Technology

$4,017

$57,626

Wal-Mart Stores Inc

Consumer Staples

$2,967

$23,198

Exxon Mobil Corp

Energy

$2,495

$141,249

The Goldman Sachs Gr Inc

Financials

$2,269

$28,726

Cisco Systems, Inc

Information Technology

$2,196

$42,702

Microsoft Corp

Information Technology

$2,023

$83,800

Procter & Gamble Co

Consumer Staples

$2,003

$46,646

Hewlett-Packard Co

Information Technology

$1,798

$41,451

Philip Morris International

Consumer Staples

$1,724

$12,605

QUALCOMM Incorp

Information Technology

$1,715

$7,605

Amgen Inc

Healthcare

$1,587

$19,617

The Travelers Companies, Inc

Financials

$1,445

$11,044

WellPoint Inc

Healthcare

$1,388

$18,339

MedcoHealth Solutions Inc

Healthcare

$1,234

$8,176

CVS Caremark Corp

Consumer Staples

$887

$8,757

Abbott Laboratories

Healthcare

$861

$5,971

Pepsico, Inc

Consumer Staples

$735

$15,767

Unitedhealth Group, Inc

Healthcare

$626

$17,960

Biogen Idec Inc

Healthcare

$578

$5,738

Lockheed Martin Corp

Industrials

$516

$11,119

Top 20


$33,065

$608,096

S&P 500


$55,259

$2,014,815

Top 20 % of S&P 500


59.84%

30.18%



About S&P Indices

S&P Indices, the world's leading index provider, maintains a wide variety of investable and benchmark indices to meet an array of investor needs. Over $1.25 trillion is directly indexed to Standard & Poor's family of indices, which includes the S&P 500, the world's most followed stock market index, the S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices, the S&P Global BMI, an index with approximately 11,000 constituents, the S&P GSCI, the industry's most closely watched commodities index, and the S&P National AMT-Free Municipal Bond Index, the premier investable index for U.S. municipal bonds. For more information, please visit www.standardandpoors.com/indices.    

About Standard & Poor's

Standard & Poor's, a subsidiary of The McGraw-Hill Companies (NYSE: MHP), is the world's foremost provider of independent credit ratings, indices, risk evaluation, investment research and data. With offices in 23 countries and markets, Standard & Poor's is an essential part of the world's financial infrastructure and has played a leading role for 150 years in providing investors with the independent benchmarks they need to feel more confident about their investment and financial decisions. For more information, visit http://www.standardandpoors.com.

SOURCE Standard & Poor's



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