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Corporate Buybacks Surge

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Corporate America is currently sitting on a lot of cash, which gives the C-suite set the financial flexibility to buy competitors, initiate or increase dividends, and buy back its own shares.

It’s the latter that now has the front offices of many publicly traded companies very interested, and apparently believing that their own stock looks like a smart investment.

Specifically, Birinyi Associates reports today that there have been 164 buyback authorizations totaling $114 billion so far this year. That's up a whopping 65% from the year-ago period.

The number-crunchers additionally broke down authorizations by sector: consumer staples had the largest number of authorizations (29) while health care logged the largest dollar value of authorizations ($20 billion).

Birinyi also highlighted the largest authorizations year-to-date and their subsequent one day performance.

Note that Intel (INTC) and Conocophillips (COP) are the largest authorizations this year at $10 billion. On a one day basis INTC was up 1.43% and 3.62% seven days after the authorization, while COP was up 1.59% and 6.36% after seven.

The top ten authorizations for 2011 returned, on average, 2.74% on a one-day basis and were up 100% of the time.

POSITION:  No positions in stocks mentioned.