Buyback
Scorecard

The table below shows the 10 most and least effective stock buyback programs among the companies in the S&P 500 that bought back at least 4 percent or $1 billion of their shares from December 31, 2011 through December 31, 2013, according to their return on investment. As calculated by Fortuna Advisors, a New York City-based consultancy that compiled the data for Institutional Investor, buyback ROI measures the overall rate of return of these companies’ buybacks, based on the internal rate of return of the cash flows associated with them. Buyback strategy tracks the performance of the underlying stock in terms of annualized total shareholder return. Once Fortuna determines buyback ROI and buyback strategy, buyback effectiveness can then be calculated as simply the difference between the two, determined as compounded return.

The Best and Worst Corporate
Stock Buyback Programs
Best
Company Industry Market
Capitalization
$ Total
Buyback
$ Total
Buyback /
Market Cap
Buyback
Strategy
Buyback
Effectiveness
Buyback ROI
1 The Boeing Co. Capital Goods 102,566 1,801 1.8 42.4 51.3 115.6
2 Gilead Sciences Pharmaceuticals, Biotechnology and Life Sciences 115,155 1,249 1.1 86.8 6.1 98.2
3 Yahoo! Software and Services 41,024 5,512 13.4 51.3 29.8 96.5
4 GameStop Corp. Retailing 5,705 614 10.8 50.5 26.0 89.5
5 Celgene Corp. Pharmaceuticals, Biotechnology and Life Sciences 69,627 4,808 6.9 56.8 15.1 80.4
6 Boston Scientific Corp. Healthcare Equipment and Services 16,049 1,100 6.9 46.3 17.4 71.7
7 Western Digital Corp. Technology Hardware and Equipment 19,845 1,746 8.8 63.8 4.1 70.5
8 Lincoln National Corp. Insurance 13,542 942 7.0 62.3 4.4 69.5
9 Southwest Airlines Co. Transportation 13,126 940 7.2 45.7 14.4 66.7
10 Ameriprise Financial Diversified Financials 22,382 2,964 13.2 55.5 6.7 66.0
Worst
Company Industry Market
Capitalization
$ Total
Buyback
$ Total
Buyback /
Market Cap
Buyback
Strategy
Buyback
Effectiveness
Buyback ROI
1 Teradata Corp. Software and Services 7,433 659 8.9 -8.3 -24.3 -30.5
2 Intuitive Surgical Healthcare Equipment and Services 14,620 1,348 9.2 -5.4 -23.4 -27.5
3 Edwards Lifesciences Corp. Healthcare Equipment and Services 7,195 850 11.8 -1.3 -15.5 -16.6
4 CenturyLink Telecommunication Services 18,826 1,623 8.6 1.6 -16.2 -14.9
5 Citrix Systems Software and Services 11,790 657 5.6 -5.2 -9.8 -14.5
6 F5 Networks Technology Hardware and Equipment 7,052 550 7.8 -8.4 -3.9 -12.0
7 Cameron International Corp. Energy 14,160 1,553 11.0 8.1 -16.8 -10.0
8 Red HAt Software and Services 10,620 436 4.1 -0.6 -7.8 -8.3
9 Coach Consumer Durables and Apparel 15,742 1,091 6.9 -4.0 -4.0 -7.8
10 International Business Machines Corp. Software and Services 203,674 25,854 12.7 0.6 -7.5 -6.9
Source: Fortuna Advisors Analysis using data from the Capital IQ database. Financial Data from December 2011 to December 2013. Includes the 486 members of the current S&P 500 that were public for the full period. Market Capitalization as of: 12/31/2013. Companies Included here if $ Total Buyback / Market Capitalization is greater than 4% or if $ Total Buyback is greater than $1 Billion.