“Buybacks as easy as A, B, C” The major headline in July’s new buyback authorizations was Alphabet’s $25BN announcement.
Alphabet’s new authorization is nearly triple their previous $8.6BN 2018 plan. Alphabet currently has a cash pile of $120BN+ and growing, surpassing Apple as the largest cash holder. Thus far, Google’s parent has been relatively modest in their buybacks, with repurchases barely outpacing stock options and thus with a limited impact on total shares outstanding. This new plan could signal more aggressive buying out of Mountain View. Investors reacted positively to earnings and the buyback announcement, with the share price of the tech giant rising by ~10%.
In addition to Alphabet, $42BN of other plans were announced in July, with more Financial sector authorizations spilling over from June, including an additional $16BN plan from Wells Fargo. Other notable authorizations include Corning ($5BN) and an array of consumer names such as United Airlines ($3BN), Altria Group ($1BN) and DR Horton ($1BN).
| Annc Date | Company Name | Annc. Amt ($MM) | Mkt Cap ($MM) | % of Mkt Cap ($MM) | Mult of 30d ADTV | Industry Sector |
|---|---|---|---|---|---|---|
| 7/25/2019 | Alphabet | 25,000 | 787,200 | 3.18% | 13.6x | Communications |
| 7/23/2019 | Wells Fargo | 16,336 | 208,605 | 7.83% | 17.9x | Financial |
| 7/17/2019 | Corning Inc | 5,000 | 25,858 | 19.34% | 27.4x | Communications |
| 7/1/2019 | L3Harris Technologies | 4,000 | 39,445 | 10.14% | 12.8x | Industrial |
| 7/15/2019 | United Airlines Holdings | 3,000 | 24,133 | 12.43% | 12.1x | Consumer, Cyclical |
| 7/17/2019 | M&T Bank | 1,635 | 23,286 | 7.02% | 12.4x | Financial |
| 7/18/2019 | E*TRADE Financial | 1,500 | 11,585 | 12.95% | 11.7x | Financial |
| 7/5/2019 | Alliance Data Systems | 1,100 | 7,766 | 14.16% | 8.7x | Financial |
| 7/30/2019 | Altria Group | 1,000 | 90,603 | 1.10% | 2.9x | Consumer, Non-cyclical |
| 7/30/2019 | DR Horton | 1,000 | 17,201 | 5.81% | 5.6x | Consumer, Cyclical |
| 7/25/2019 | Universal Health Services | 1,000 | 12,346 | 8.10% | 10.9x | Consumer, Non-cyclical |
| 7/30/2019 | Zebra Technologies | 1,000 | $11,808 | 8% | 7.0x | Technology |
Data sources: Bloomberg, Guzman & Co.
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