If we had to PowerPoint to one Word that caused buyback volumes to Excel in September, providing further Outlook into markets, it would be “Microsoft”.
The tech giant led the month with a new $40BN share repurchase authorization, representing just under 4% of their market capitalization.
As is recent tradition with buybacks, the Tech and Financial sectors continue to drive volumes, representing 83% of the $85BN of volume authorized in September. Top sector announcements, after MSFT, came from Oracle ($15BN) and American Express ($14.1BN). Other notable authorizations were announced by Target ($5BN), Lockheed Martin ($1BN) and JetBlue ($800M). The average September authorization size was ~7% of market cap.
With the end of Q3, quarterly announcements resulted in ~$170BN of authorizations, which is below the past 3 year average, yet still above mid-2017 numbers. Signs continue to point to strong buyback levels albeit below 2018 record highs, still boosted by tech and financials. More Q3 data can be found on the second page of this report here.
Top September Announcements
| Annc Date | Company Name | Annc. Amt ($MM) | Mkt Cap ($MM) | % of Mkt Cap ($MM) | Mult of 30d ADTV | Industry Sector |
|---|---|---|---|---|---|---|
| 9/18/2019 | Microsoft | 40,000 | 1,057,657 | 3.78% | 12.3x | Technology |
| 9/11/2019 | Oracle | 15,000 | 187,773 | 7.99% | 16.8x | Technology |
| 9/23/2019 | American Express | 14,135 | 98,101 | 14.41% | 33.0x | Financial |
| 9/19/2019 | Target | 5,000 | 55,114 | 9.07% | 11.1x | Consumer, Cyclical |
| 9/18/2019 | Masco | 2,000 | 12,007 | 16.66% | 16.1x | Industrial |
| 9/3/2019 | Concho Resources | 1,500 | 13,963 | 10.74% | 8.5x | Energy |
| 9/17/2019 | KLA | 1,000 | 24,302 | 4.11% | 3.9x | Technology |
| 9/26/2019 | Lockheed Martin | 1,000 | 110,960 | 0.90% | 2.4x | Industrial |
Data sources: Bloomberg, Guzman & Co.
Related Content
Monthly Market Update: September 2020
Buybacks in Recessionary Periods
Monthly Market Update: February 2020
Related Content
Monthly Market Update: September 2020
Buybacks in Recessionary Periods
Monthly Market Update: February 2020
Monthly Market Update: January 2020
Disclaimer
The Information presented is for information purposes only and may not be communicated, reproduced, or distributed without Guzman & Company’s (“Guzman”) express authorization. This communication has been prepared by sales, trading, or other non-research personnel of Guzman. The information presented has been compiled from publicly available information and sources that Guzman believes to be reliable, but Guzman does not represent or warrant that the information is accurate or complete and undertake no obligation to update the information presented. This is not a Research Report and the information presented is insufficient to form an investment opinion. Guzman makes no express warranties with respect to any information included in this communication, and expressly disclaims all warranties of merchantability or fitness for a particular purpose or use. Without limiting any of the foregoing and to the extent permitted by law, Guzman accepts no liability whatsoever for any consequential losses arising from the use or reliance on the information contained herein. Guzman & Company is a registered broker dealer in Coral Gables, FL, Member FINRA, SIPC.