| Buyback Scorecard Stock Buybacks Wrestle with an Aging BullThe S&P 500 as Stock Repurchasers Industry Comparisons |
The table below ranks the 278 companies in the S&P 500 that bought back at least 4 percent of their shares from December 31, 2013, through December 31, 2014. The companies are ranked according to their return on investment from these repurchases. 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 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 Cap ($ Millions) | Total Buyback (S Millions) | $ Total Buyback as % Market Cap | Buyback Strategy | Buyback Effectiveness | Buyback ROI | ||
| 1 | Southwest Airlines Co. | Transportation | 28,724 | 1,495 | 5.2 | 101.2 | 2.0 | 105.2 | |
| 2 | Darden Restaurants | Consumer Services | 7,273 | 503 | 6.9 | 7.6 | 67.4 | 80.2 | |
| 3 | Keurig Green Mountain | Food, Beverage and Tobacco | 21,449 | 1,223 | 5.7 | 117.9 | -20.9 | 72.2 | |
| 4 | HCA Holdings | Healthcare Equipment and Services | 31,819 | 2,250 | 7.1 | 55.3 | 3.9 | 61.4 | |
| 5 | Yahoo | Software and Services | 47,851 | 7,508 | 15.7 | 62.6 | -4.2 | 55.7 | |
| 6 | The Kroger Co. | Food and Staples Retailing | 31,548 | 1,892 | 6.0 | 54.1 | 0.8 | 55.4 | |
| 7 | Delta Air Lines | Transportation | 41,169 | 1,350 | 3.3 | 103.8 | -24.6 | 53.7 | |
| 8 | Edwards Lifesciences Corp. | Healthcare Equipment and Services | 13,626 | 798 | 5.9 | 15.7 | 32.9 | 53.7 | |
| 9 | Apple | Technology Hardware and Equipment | 647,361 | 70,940 | 11.0 | 17.5 | 30.7 | 53.5 | |
| 10 | Gilead Sciences | Pharmaceuticals, Biotechnology and Life Sciences | 142,207 | 5,931 | 4.2 | 70.3 | -10.0 | 53.3 | |
| Worst | |||||||||
| Company | Industry | Market Cap ($ Millions) | Total Buyback (S Millions) | $ Total Buyback as % Market Cap | Buyback Strategy | Buyback Effectiveness | Buyback ROI | ||
| 1 | Nabors Industries Ltd. | Energy | 3,757 | 250 | 6.7 | 6.6 | -88.1 | -87.3 | |
| 2 | Whole Foods Market | Energy | 2,834 | 493 | 17.4 | -18.2 | -22.6 | -36.7 | |
| 3 | Coach | Consumer Durables and Apparel | 10,351 | 525 | 5.1 | -18.8 | -15.5 | -31.4 | |
| 4 | Apache Corp. | Energy | 23,594 | 2,861 | 12.1 | -5.0 | -22.9 | -26.7 | |
| 5 | Mattel | Consumer Durables and Apparel | 10,485 | 670 | 6.4 | -4.7 | -17.8 | -21.7 | |
| 6 | Fluor Corp. | Capital Goods | 9,472 | 975 | 10.3 | 7.7 | -27.1 | -21.4 | |
| 7 | Ford Motor Co. | Automobiles and Components | 59,655 | 2,177 | 3.6 | 19.1 | -33.8 | -21.1 | |
| 8 | Discovery Communications | Media | 22,900 | 2,727 | 11.9 | 7.6 | -20.9 | -14.9 | |
| 9 | Urban Outfitters | Retailing | 4,625 | 500 | 10.8 | -6.8 | -8.6 | -14.8 | |
| 10 | The ADT Corp. | Commercial and Professional Services | 6,323 | 2,698 | 42.7 | -7.9 | -5.7 | -13.2 | |
| Source: Fortuna Advisors Analysis using data from the Capital IQ database. Financial Data from December 2013 to December 2014. Includes the 493 members of the current S&P 500 that were public for the full period. Market Capitalization as of: 12/31/2014. Companies included here if $ Total Buyback / Market Capitalization is greater than 4% or if $ Total Buyback is greater than $1 billion. | |||||||||
