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First-Quarter 2014 Corporate Buyback Scorecard; Best & Worst Companies

Buyback
Scorecard CFOs Share Their Stock Buyback Secrets The S&P 500 as Stock Repurchasers Industry Comparisons

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 March 31, 2012 through March 31, 2014, 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
Cap ($ Millions)
Total
Buyback (S Millions)
$ Total
Buyback as %
Market Cap
Buyback
Strategy
Buyback
Effectiveness
Buyback ROI
1 Keurig Green MountainFood, Beverage and Tobacco17,084 1,146 6.7 32.4 94.3 157.2
2 Gilead SciencesPharmaceuticals, Biotechnology and Life Sciences108,9721,679 1.5 81.4 5.0 90.4
3 Southwest Airlines Co.Transportation16,5741,205 7.3 57.4 17.0 84.1
4 Yahoo!Software and Services36,2375,891 16.3 57.7 13.2 78.6
5 Boston Scientific Corp.Healthcare Equipment and Services17,8931,087 6.1 49.2 17.3 74.9
6 Western Digital Corp.Technology Hardware and Equipment21,6941,990 9.2 53.2 13.5 73.9
7 Tyson FoodsFood, Beverage and Tobacco14,9761,025 6.8 41.5 22.0 72.6
8 The Dow Chemical Co.Materials58,769 1,557 2.6 22.1 37.1 67.4
9 McKesson Corp.Healthcare Equipment and Services40,6341,344 3.3 46.9 13.3 66.4
10 Lincoln National Corp.Insurance13,362942 7.1 47.0 12.9 66.0
Worst
Company Industry Market
Cap ($ Millions)
Total
Buyback (S Millions)
$ Total
Buyback as %
Market Cap
Buyback
Strategy
Buyback
Effectiveness
Buyback ROI
1 Teradata Corp.Software and Services7,848745 9.5 -13.4 -10.8 -22.8
2 CenturyLinkTelecommunication Services18,9801,940 10.2 -4.3 -9.6 -13.4
3 Edwards Lifesciences Corp.Healthcare Equipment and Services7,7971,05013.5 -3.1-10.0 -12.8
4 Citrix SystemsSoftware and Services10,555 557 5.3 -9.2 -3.7 -12.6
5 Apache Corp.Energy32,742 1,500 4.6-9.9 -1.9 -11.6
6 Quest DiagnosticsHealthcare Equipment and Services8,3561,219 14.6 -2.5 -9.3 -11.6
7 CoachConsumer Durables and Apparel13,785 1,094 7.9 -15.1 4.7 -11.1
8 MattelConsumer Durables and Apparel13,652555 4.1 16.3 -21.3 -8.5
9 CH Robinson WorldwideTransportation7,719 1,004 13.0 -7.1 -1.5 -8.5
10 Marathon Oil Corp.Energy24,5731,051 4.3 3.8 -11.6 -8.2
Source: Fortuna Advisors Analysis using data from the Capital IQ database. Financial Data from March 2012 to March 2014. Includes the 490 members of the current S&P 500 that were public for the full period. Market Capitalization as of: 03/31/2014. Companies Included here if $ Total Buyback / Market Capitalization is greater than 4% or if $ Total Buyback is greater than $1 Billion.