I love these quotes:
Buybacks have decelerated since the start of 2Q given reduced authorizations and high stock valuations. We expect further near-term deceleration. However, record buybacks in 1Q and remaining capacity suggest full-year repurchases will rise by 7% to $600 billion. Investors have rewarded buybacks for many years but the pattern has reversed in 2016. Our Buyback basket (GSTHREPO) has lagged the S&P 500 YTD (5% vs. 7%). Managers should focus on firms returning cash to shareholders via dividends.
and
“So far in 2016 investors have penalized firms that executed buybacks while rewarding firms with high dividends and high capex.”
“During periods of low growth and low interest rates, firms with the highest buybacks fail to provide investors with either the consistent yield of bond-like assets or the prospect of future growth.”
-Goldman Sachs via Matt Levine
