NEW YORK, June 14, 2023 /PRNewswire/ -- S&P Dow Jones Indices ("S&P DJI") announced today preliminary S&P 500® stock buybacks, or share repurchases, data for Q1 2023.
Historical data on S&P 500 buybacks are available at www.spdji.com/indices/equity/sp-500.
Key Takeaways:
"Companies, led by Financials, pushed buybacks up slightly. If Financials had not returned to the buyback market, the 2.1% expenditure increase would have been a 10.6% decline, as 8 of the 11 sectors pulled back. While the year-to-date S&P 500 price increase was top-heavy, the Q1 2023 buyback market was Financial heavy. The EPS impact, due to share count reduction, also declined, as 18.5% of the issues increased their Q1 2023 EPS year-over-year by at least 4% compared to 19.4% last quarter," said Howard Silverblatt, Senior Index Analyst at S&P Dow Jones Indices. "Going forward and given the recent banking issues and the current regulatory reviews, banks may again pull back on buybacks to protect their dividends for what is expected to be a more difficult Fed stress test due to stricter and more extensive regulations."
1% Buyback Excise Tax for 2023:
On a proforma basis, the new 1% excise tax on net buybacks reduced Q1 2023 operating earnings by 0.45%, down from proforma 0.46% for Q4 2022 and the proforma 2022 0.51%, with as reported GAAP earnings being reduced by 0.49%, down from the proforma 0.58% for Q4 2022 and the proforma 2022 0.58%.
Silverblatt added: "The 1% tax is an additional cost, but it is still not significant enough to impact the overall buybacks at this point. In his proposed fiscal 2024 budget, President Biden quantified increasing the tax to 4%, but no changes were incorporated into the recently passed Fiscal Responsibility Act of 2023 (debt ceiling deal). Given the initial 1% buyback tax had bipartisan support, there is an expectation that some increase and/or potentially a change to the type of buybacks that are taxed to be discussed later this year for fiscal 2024. An increase to the 2.5% area could start to impact buybacks and the EPS impact of share-count-reduction due to some of the expenditures shifting from buybacks to dividends. Any shift however would not be on a-dollar-for-dollar basis, as dividends remain a long-term pure cash-flow item which must be incorporated into corporate budgets."
Q1 2022 GICS® Sector Analysis:
Financials, as expected, returned to the buyback market in 2023, after pulling back in Q2, Q3 and Q4 2022. For Q1 2023, Financials spent $46.9 billion on buybacks, accounting for 21.8% of all S&P 500 buybacks. This was up 108% from their Q4 2022 $22.5 billion expenditure, which represented 10.7% of buybacks, but were still down 14.3% from their Q1 2022 $54.7 billion in buybacks, which represented 19.5% of buybacks. Financials spent the most of any sector in Q1 2023, overtaking Information Technology for the first time since Q3 2017 (Information Technology had held the lead since Q4 2017). For the 12-month March 2023 period, Financials spent $113.6 billion, down from $209.9 billion for the 12-month June 2022 period. Given the recent banking events and current regulatory review, there is some discussion if the sector will again pull back on buybacks, partially to protect their dividends during stress tests.
Information Technology pulled back 20.3% on buybacks for the quarter, spending $45.9 billion in Q1 2023, representing 21.3% of all buybacks. This was down from the Q4 2022 $57.7 billion, which accounted for 27.3% of the buybacks and down from the Q1 2022 expenditure of $71.6 billion (25.5% of the buybacks). For the 12-month March period the sector spent $236.3 billion, down 14.2% from the prior period's $275.3 billion.
Energy decreased their buybacks by 2.7% for the quarter to $19.3 billion, representing 9.0% of the buybacks compared to the prior quarter's $19.8 billion, as the Q1 2023 quarter was an increase of 126% over Q1 2022's $8.6 billion level. For the 12-month period ending in March 2023, Energy spent $74.5 billion on buybacks, up 259% from the prior period's $20.8 billion.
Health Care buybacks decreased 4.9% for the quarter, spending $23.2 billion in Q1 2023, representing 10.8% of all buybacks. This was down from the Q4 2022 $24.4 billion and Q1 2022's $41.1 billion. For the 12-month March period, the sector spent $84.8 billion, down 12.3% from prior 12-month period's $96.9 billion.
Issues:
The five issues with the highest total buybacks for Q1 2023 are:
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S&P Dow Jones Indices | |||
S&P 500 proforma net buyback tax impact | |||
TAX | TAX % OF | TAX % OF | |
$ BILLIONS | OPERATING | AS REPORTED | |
Q1 2023 | $1.98 | 0.45 % | 0.49 % |
2022 proforma | $8.47 | 0.51 % | 0.58 % |
2021 proforma | $7.93 | 0.45 % | 0.47 % |
S&P Dow Jones Indices | ||||||||
S&P 500, $ U.S. BILLIONS | (preliminary in bold) | |||||||
PERIOD | MARKET | OPERATING | AS REPORTED | DIVIDEND & | ||||
VALUE | EARNINGS | EARNINGS | DIVIDENDS | BUYBACKS | DIVIDEND | BUYBACK | BUYBACK | |
$ BILLIONS | $ BILLIONS | $ BILLIONS | $ BILLIONS | $ BILLIONS | YIELD | YIELD | YIELD | |
12 Mo Mar,'23 Prelim. | $34,342 | $1,678.51 | $1,469.32 | $573.73 | $857.20 | 1.67 % | 2.50 % | 4.17 % |
12 Mo Mar,'22 | $38,288 | $1,778.72 | $1,675.06 | $524.92 | $984.60 | 1.37 % | 2.57 % | 3.94 % |
2022 | $32,133 | $1,656.66 | $1,453.43 | $564.57 | $922.68 | 1.76 % | 2.87 % | 4.63 % |
2021 | $40,356 | $1,762.75 | $1,675.22 | $511.23 | $881.72 | 1.27 % | 2.18 % | 3.45 % |
2020 | $31,659 | $1,019.04 | $784.21 | $483.18 | $519.76 | 1.53 % | 1.64 % | 3.17 % |
2019 | $26,760 | $1,304.76 | $1,158.22 | $485.48 | $728.74 | 1.81 % | 2.72 % | 4.54 % |
7/10/1905 | $21,027 | $1,281.66 | $1,119.43 | $456.31 | $806.41 | 2.17 % | 3.84 % | 6.01 % |
3/31/2023 Prelim. | $34,342 | $439.00 | $404.57 | $146.76 | $215.53 | 1.67 % | 2.50 % | 4.17 % |
12/31/2022 | $32,133 | $421.55 | $331.50 | $146.07 | $211.19 | 1.76 % | 2.87 % | 4.63 % |
9/30/2022 | $30,119 | $422.94 | $373.04 | $140.34 | $210.84 | 1.83 % | 3.26 % | 5.09 % |
6/30/2022 | $31,903 | $395.02 | $360.21 | $140.56 | $219.64 | 1.70 % | 3.15 % | 4.85 % |
3/31/2022 | $38,288 | $417.16 | $388.68 | $137.60 | $281.01 | 1.37 % | 2.57 % | 3.94 % |
12/31/2021 | $40,356 | $480.35 | $456.72 | $133.90 | $270.10 | 1.27 % | 2.18 % | 3.45 % |
9/30/2021 | $36,538 | $441.26 | $420.64 | $130.04 | $234.64 | 1.37 % | 2.03 % | 3.40 % |
6/30/2021 | $36,325 | $439.95 | $409.02 | $123.38 | $198.84 | 1.33 % | 1.68 % | 3.01 % |
3/31/2021 | $33,619 | $401.19 | $388.84 | $123.91 | $178.13 | 1.43 % | 1.48 % | 2.91 % |
12/31/2020 | $31,659 | $321.81 | $265.00 | $121.62 | $130.59 | 1.53 % | 1.64 % | 3.17 % |
9/30/2020 | $27,868 | $314.06 | $273.29 | $115.54 | $101.79 | 1.75 % | 2.05 % | 3.80 % |
6/30/2020 | $25,637 | $221.53 | $147.44 | $119.04 | $88.66 | 1.93 % | 2.52 % | 4.45 % |
3/31/2020 | $21,424 | $161.64 | $98.48 | $126.98 | $198.72 | 2.31 % | 3.37 % | 5.68 % |
12/31/2019 | $26,760 | $324.52 | $294.29 | $126.35 | $181.58 | 1.81 % | 2.72 % | 4.54 % |
9/30/2019 | $24,707 | $330.42 | $282.12 | $123.12 | $175.89 | 1.94 % | 3.12 % | 5.06 % |
6/28/2019 | $24,423 | $333.26 | $290.00 | $118.68 | $165.46 | 1.93 % | 3.27 % | 5.20 % |
3/29/2019 | $23,619 | $316.56 | $291.82 | $117.33 | $205.81 | 1.97 % | 3.49 % | 5.45 % |
S&P Dow Jones Indices | |||||||
S&P 500 SECTOR BUYBACKS | |||||||
SECTOR $ MILLIONS | Q1,'23 | Q4,'22 | Q1,'22 | 12MoMar,'23 | 12MoMar,'22 | 5-YEARS | 10-YEARS |
Consumer Discretionary | $18,301 | $18,819 | $28,238 | $84,301 | $98,873 | $365,078 | $785,540 |
Consumer Staples | $6,284 | $7,033 | $8,419 | $35,294 | $38,485 | $163,182 | $384,386 |
Energy | $19,304 | $19,833 | $8,552 | $74,534 | $20,755 | $139,160 | $256,567 |
Financials | $46,891 | $22,497 | $54,690 | $113,632 | $209,908 | $734,551 | $1,212,659 |
Healthcare | $23,194 | $24,394 | $41,134 | $84,941 | $96,898 | $413,238 | $777,021 |
Industrials | $14,239 | $22,403 | $24,745 | $71,589 | $73,474 | $314,241 | $652,181 |
Information Technology | $45,923 | $57,654 | $71,580 | $236,303 | $275,264 | $1,209,727 | $1,920,351 |
Materials | $3,773 | $6,548 | $7,434 | $24,725 | $26,555 | $91,274 | $158,896 |
Real Estate | $526 | $728 | $1,131 | $3,174 | $2,089 | $13,468 | $18,954 |
Communication Services | $35,797 | $31,155 | $34,069 | $126,691 | $139,872 | $428,049 | $446,104 |
Utilities | $1,299 | $126 | $1,017 | $2,018 | $2,423 | $13,820 | $19,014 |
TOTAL | $215,532 | $211,189 | $281,011 | $857,202 | $984,596 | $3,885,787 | $6,631,672 |
SECTOR BUYBACK MAKEUP % | Q1,'23 | Q4,'22 | Q1,'22 | 12MoMar,'23 | 12MoMar,'22 | 5-YEARS | 10-YEARS |
Consumer Discretionary | 8.49 % | 8.91 % | 10.05 % | 9.83 % | 10.04 % | 9.40 % | 11.85 % |
Consumer Staples | 2.92 % | 3.33 % | 3.00 % | 4.12 % | 3.91 % | 4.20 % | 5.80 % |
Energy | 8.96 % | 9.39 % | 3.04 % | 8.70 % | 2.11 % | 3.58 % | 3.87 % |
Financials | 21.76 % | 10.65 % | 19.46 % | 13.26 % | 21.32 % | 18.90 % | 18.29 % |
Healthcare | 10.76 % | 11.55 % | 14.64 % | 9.91 % | 9.84 % | 10.63 % | 11.72 % |
Industrials | 6.61 % | 10.61 % | 8.81 % | 8.35 % | 7.46 % | 8.09 % | 9.83 % |
Information Technology | 21.31 % | 27.30 % | 25.47 % | 27.57 % | 27.96 % | 31.13 % | 28.96 % |
Materials | 1.75 % | 3.10 % | 2.65 % | 2.88 % | 2.70 % | 2.35 % | 2.40 % |
Real Estate | 0.24 % | 0.34 % | 0.40 % | 0.37 % | 0.21 % | 0.35 % | 0.29 % |
Communication Services | 16.61 % | 14.75 % | 12.12 % | 14.78 % | 14.21 % | 11.02 % | 6.73 % |
Utilities | 0.60 % | 0.06 % | 0.36 % | 0.24 % | 0.25 % | 0.36 % | 0.29 % |
TOTAL | 100.00 % | 100.00 % | 100.00 % | 100.00 % | 100.00 % | 100.00 % | 100.00 % |
S&P Dow Jones Indices | ||||||||||
S&P 500 20 LARGEST Q1 2023 BUYBACKS, $ MILLIONS | ||||||||||
Company | Ticker | Sector | Q1 2023 | Q4 2022 | Q1 2022 | 12-Months | 12-Months | 5-Year | 10-Year | Indicated |
Buybacks | Buybacks | Buybacks | Mar,'23 | Mar,'22 | Buybacks | Buybacks | Dividend | |||
$ Million | $ Million | $ Million | $ Million | $ Million | $ Million | $ Million | $ Million | |||
Apple | AAPL | Information Technology | $20,012 | $21,791 | $22,961 | $91,101 | $92,371 | $416,885 | $621,306 | $14,278 |
Alphabet | GOOGL | Communication Services | $14,557 | $15,407 | $13,300 | $60,553 | $52,179 | $180,574 | $193,066 | $0 |
Meta Platforms | META | Communication Services | $10,374 | $7,520 | $10,431 | $31,494 | $55,467 | $121,833 | $130,224 | $0 |
Microsoft | MSFT | Information Technology | $5,509 | $5,459 | $8,822 | $25,298 | $31,116 | $121,495 | $180,412 | $20,247 |
T-Mobile US | TMUS | Communication Services | $4,806 | $2,461 | $172 | $7,877 | $270 | $28,973 | $30,656 | $0 |
Berkshire Hathaway | BRK.b | Financials | $4,450 | $2,608 | $3,180 | $9,124 | $23,661 | $70,267 | $70,267 | $0 |
Exxon Mobil | XOM | Energy | $4,340 | $4,675 | $2,067 | $17,428 | $2,221 | $20,848 | $50,599 | $14,990 |
Wells Fargo | WFC | Financials | $4,016 | $6 | $6,018 | $4,031 | $19,886 | $71,227 | $116,558 | $4,573 |
Goldman Sachs Group | GS | Financials | $3,825 | $1,504 | $2,031 | $6,889 | $4,578 | $26,515 | $58,810 | $3,386 |
Chevron | CVX | Energy | $3,607 | $3,417 | $0 | $12,410 | $618 | $19,148 | $27,027 | $10,745 |
Johnson & Johnson | JNJ | Health Care | $3,548 | $1,320 | $1,577 | $8,006 | $3,595 | $27,430 | $60,241 | $12,445 |
Broadcom | AVGO | Information Technology | $3,420 | $1,521 | $3,290 | $7,007 | $7,002 | $28,832 | $29,264 | $7,689 |
Marathon Petroleum | MPC | Energy | $3,180 | $0 | $2,846 | $7,088 | $7,500 | $17,498 | $26,852 | $1,362 |
Thermo Fisher Scientific | TMO | Health Care | $3,000 | $1,057 | $2,000 | $4,057 | $2,101 | $11,665 | $14,168 | $549 |
Mastercard | MA | Financials | $2,954 | $2,418 | $2,540 | $9,308 | $7,100 | $32,750 | $50,131 | $1,924 |
Home Depot | HD | Consumer Discretionary | $2,887 | $1,560 | $2,308 | $7,275 | $13,329 | $40,990 | $77,341 | $8,520 |
Charles Schwab | SCHW | Financials | $2,842 | $1,940 | $0 | $6,237 | $0 | $9,457 | $9,457 | $1,525 |
JPMorgan Chase | JPM | Financials | $2,690 | $0 | $2,455 | $3,397 | $16,057 | $70,090 | $111,840 | $11,733 |
Verisk Analytics | VRSK | Industrials | $2,512 | $467 | $583 | $3,613 | $886 | $5,671 | $7,375 | $213 |
Bank of America | BAC | Financials | $2,215 | $998 | $2,650 | $4,638 | $24,306 | $82,819 | $112,872 | $6,142 |
Top 20 | $104,744 | $76,129 | $89,231 | $326,831 | $364,243 | $1,404,967 | $1,978,466 | $120,320 | ||
S&P 500 | $215,532 | $211,189 | $281,011 | $857,202 | $984,596 | $3,885,787 | $6,631,672 | $576,004 | ||
Top 20 % of S&P 500 | 48.60 % | 36.05 % | 31.75 % | 38.13 % | 36.99 % | 36.16 % | 29.83 % | 20.89 % | ||
Gross values are not adjusted for float |
S&P Dow Jones Indices | ||||
S&P 500 Q1 2023 Buyback Report | ||||
SECTOR | DIVIDEND | BUYBACK | COMBINED | |
YIELD | YIELD | YIELD | ||
Consumer Discretionary | 0.88 % | 2.10 % | 2.98 % | |
Consumer Staples | 2.66 % | 1.57 % | 4.22 % | |
Energy | 3.75 % | 4.61 % | 8.36 % | |
Financials | 1.93 % | 3.03 % | 4.97 % | |
HealthCare | 1.76 % | 1.74 % | 3.50 % | |
Industrials | 1.73 % | 2.38 % | 4.12 % | |
Information Technology | 0.87 % | 2.14 % | 3.01 % | |
Materials | 2.10 % | 2.87 % | 4.96 % | |
Real Estate | 3.73 % | 0.36 % | 4.09 % | |
Communications Services | 1.04 % | 5.18 % | 6.22 % | |
Utilities | 3.32 % | 0.21 % | 3.53 % | |
S&P 500 | 1.64 % | 2.42 % | 4.05 % | |
Uses full values (unadjusted for float) | ||||
Dividends based on indicated; buybacks based on the last 12-months ending Q1,'23 |
Share Count Changes | ||
(Y/Y diluted shares used for EPS) | >=4% |
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