S&P 500 Buybacks Plunge 21.8% in Q2 as Financials Pull Back Sharply

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© Reuters. S&P 500 Buybacks Plunge 21.8% in Q2 as Financials Pull Back Sharply

By Investing.com Staff

Stock buybacks for companies were $219.6 billion in the second quarter, down 21.8% from the first quarter’s record of $281.0 billion, according to S&P Dow Jones Indices.

Notably, financials significantly cut back on buybacks, decreasing their expenditures 61.2% to $21.2 billion. Also, Health Care buybacks decreased 58.2% in the quarter.

Buybacks remained top-heavy and increased, with the top 20 companies accounting for 46.8% of Q2 2022 buybacks. Information Technology continued to lead in buybacks. The five companies with the highest total buybacks for Q2 2022 were: Apple (NASDAQ:), Alphabet (NASDAQ:), Microsoft (NASDAQ:), Meta Platforms Inc (NASDAQ:), and Lowe’s (NYSE:). Meanwhile, energy stocks reentered the buyback market, as they increased their expenditures by 56.5% for the quarter.

“Companies pulled back from their Q1 record-breaking buyback expenditures, with 11.5% fewer companies participating, as they spent 21.8% less. There were significant reductions in Financials and Health Care issues, as Energy issues have reentered the buyback market, and are again buying,” said Howard Silverblatt, Senior Index Analyst at S&P Dow Jones Indices. “The steep decline in prices, however, led to more shares repurchased, as 21.3% of the companies in the S&P 500 increased their earnings-per-share by at least 4% thanks to their newly lowered share counts, up from the 17.6% in Q1 2022, and 5.4% in Q2 2021.”