Buybacks are surging, hitting over $815 billion this year!
Denver Nowicz
?? LinkedIn Top Voice Economy & Finance ┃ Building safe and secure financial plans one family at a time. ┃ Advanced tax defense and wealth enhancement tactics.
Is this what is keeping the market up?
?? Learn: The number one reason the stock market is up?
What are stock buybacks? This is when public companies use their profits and excess cash to buy their own shares off the open market, and then cancel the stock.
Buybacks are surging to over $815 Billion this year:
Analysts often credit the rise in passive investing for market resilience. However, buybacks might be playing an even bigger role.
This certainly has an impact in keeping the market up. Goldman Sachs predicts S&P companies will spend over $1 Trillion on share repurchases in 2025.
Corporate profits have surged, especially in 2021, due to increased government spending related to COVID-19. This cycle continues: higher deficits lead to higher profits, which lead to more buybacks and inflated stock prices.
With the stock market at record highs, corporations are aggressively buying back stock. Some see this as confidence, while others see it as overestimating the sustainability of profits.
If deficit spending is a key to maintaining corporate profitability will this eventually be cut off?
We haven’t for over 20 years so keep the party going!
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Thank you for?reading!
Founder & CEO, Group 8 Security Solutions Inc. DBA Machine Learning Intelligence
4 个月Good job!
Ghostwriter and marketing pro who translates your business vision into strategy and words. I help entrepreneurs and professionals succeed in the 2nd half of life.
4 个月Yet another reason to look deeper into the numbers - the stock market tells lots of different stories, so it's crucial to look deeper. I love that insight and also the one about starting every day with an egg or cottage cheese - protein for the win!
Helping solopreneurs and small business owners find new ways to grow | Researcher | Futures Thinker | Facilitator supporting the Power of Peers | Avid Curler | Voracious Reader
4 个月I agree that these buybacks are influencing the market and I am not really a fan, just as I am not a fan of using layoffs to increase stock prices (indirectly). Hence my passion for helping SMALL private businesses grow! Side note - I agree 100% with your breakfast productivity tip! I love to eat plain Greek yogurt mixed with fresh fruit and maybe a little granola for my breakfast! :)
??19M+ impression | Believer in Individuals with?a?Vision??? | Futurist | Tech Visionary |#1 Qatar Favikon LinkedIn | ?? Innovation Enthusiast - Angel Investor with a Passion for Innovation | ??
4 个月??Interesting insights! It's clear that the surge in buybacks is playing a significant role in driving up the market. Buybacks not only reduce the number of shares available but also signal confidence from the management about future prospects. Also, those passive inflows add another layer to the upward momentum. It's always fascinating to see how different factors intertwine in the financial ecosystem. Keep up the great work with your weekly newsletter! ???? #InvestmentStrategies #StockMarketTrends #FinancialInsights