With the last half of March upon us, the blackout of stock buybacks threatens to reduce one of the liquidity sources supporting the bullish run this year. If you don’t understand the importance of corporate share buybacks and the blackout periods, here is a snippet of a 2023 article I previously wrote.
“The chart below via Pavilion Global Markets shows the impact stock buybacks have had on the market over the last decade. The decomposition of returns for the S&P 500 breaks down as follows:“
6.1% from multiple expansions (21% at Peak),
57.3% from earnings (31.4% at Peak),
9.1% from dividends (7.1% at Peak), and
27% from share buybacks (40.5% at Peak)
Yes, buybacks are that important.
As John Authers pointed out:
“For much of the last
Read More »