U.S. companies are rushing to repurchase large volumes of shares to take advantage of recent stock market volatility and reassure investors as growth slows, reported Financial Times. The management uses the share buybacks to prop up demand for their stock and increase their profitability on an EPS basis by reducing the number of shares in circulation. What happened According to Goldman Sachs data, a record $319 billion of new share buybacks have been authorized so far this year, with rising numbers of companies using “accelerated” deals to buy large volumes as quickly as possible while their share prices are depressed. There were $267 billion in share buybacks at the same point in 2021. “The breadth of different industry groups buying stock is the highest we’ve seen in a few years, and volumes have increased. That’s much more due to the market backdrop as opposed to anything else”, Michael Voris, Goldman Sachs’ …
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