Companies represented in the S&P 500 recently announced that, in aggregate, $104.3 billion in stock buybacks were made in February. This not only is twice the $55 billion repurchased a year ago, but a record for equity repurchases in any single month. The previous monthly high was $99.8 billion, set in July 2006, following which the S&P returned 23% over the next 14 months. Well over $2 trillion has been spent on buybacks since 2009. Translation? Organizations, and the leadership within them, have a certain degree of confidence that their stock is somewhat undervalued and poised to rise in the future as business, profits, and the overall economy continue to expand. Is this a promise or a prediction? No and never. Is it a continued confidence-builder in the ongoing bull market, now in its sixth year, that the most knowledgeable folks within the highest profile corporations are willing to further invest in their own companies as part of their strategic vision for the years ahead? Can’t argue that. Have a plan. Stay diversified.
Source for data was First Trust Market Watch, 3/9/15
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