Apple’s massive, record-breaking $226.6 billion stock buyback is credited with helping drive the longest-running bull market in U.S. stock market history.
A bull market refers to a market in which share prices are rising, thereby encouraging buying. A new report credits eight companies — including Apple — who have engaged in massive share buybacks as being part-responsible for this 9.5-year bull run. Together, they have formed, “a solid backbone of the stock market’s continued growth.”
The report notes that:
“According to S&P Dow Jones Indices, S&P 500 companies have bought back $4.4 trillion shares over the past decade, including the record-breaking buybacks from Apple that totaled $226.6 billion. No company has bought back more shares than Apple, which announced in March 2012 it would use a large chunk of cash to make the purchases.”
Helping the stock market thrive
The amount spent on share repurchases by S&P 500 companies hit $190.6 billion in the second quarter 2018. This represents a 58.7 percent year-over-year increase. That number is expected to keep right on climbing in the following months.
“Given the record earnings, strong cash-flow, investor demand and corporate statements, the indications are that the high level will continue for the rest of the year,” said Howard Silverblatt, senior index analyst at S&P Dow Jones Indices.
Along with Apple, seven other companies are credited with contributing a massive $689.4 billion in share buybacks. These companies are mostly in the tech or financial sectors. They include Home Depot, Intel, Wells Fargo, JPMorgan Chase, Oracle, Cisco, and Microsoft.
After Apple, the company on the list that has spent on buying back stock in Microsoft. However, its $102.8 billion spent over the past decade is less than half the sum Apple has shelled out during that period.
Apple is currently valued at a massive $1.1 trillion, having become the first company in history to pass the $1 trillion valuation mark back in early August.
Source: Business Insider
