S&P 500 Buybacks & Dividends - Yardeni Research

Corporate Finance Briefing: S&P 500 Buybacks & Dividends

Yardeni Research, Inc.

February 11, 2022

Dr. Edward Yardeni

516-972-7683 eyardeni@

Joe Abbott

732-497-5306 jabbott@

Mali Quintana

480-664-1333 aquintana@

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Table Of Contents Table Of Contents

Buybacks & Dividends

3-6

Buybacks

7

S&P 1500/500/400/600 Divisors

8

Buybacks & Dividends

9

Buybacks & Dividends as % of Operating Earnings

10

S&P 500 Sectors Buybacks

11

S&P 500 Sectors Cumulative Buybacks Since Q1-2009

12

S&P 500 Sectors Dividends

13

S&P 500 Sectors Buybacks

14

February 11, 2022 / S&P 500 Buybacks & Dividends

Yardeni Research, Inc.



Buybacks & Dividends

Figure 1.

1050

S&P 500 BUYBACKS 950 (billion dollars, annualized)

850 Actual x 4 (938.6)

750

4-Quarter Sum (742.2)

1050

Q3

950

850

Q3

750

650

650



550

550

450

450

350

350

250

250

150

150

50

50

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Source: Standard & Poor's.

Figure 2.

550

S&P 500 DIVIDENDS (billion dollars, annualized)

500

550 Q4

500

450

450

400

Actual x 4 (534.4)

400

4-Quarter Sum (511.4)

350

350



300

300

250

250

200

200

150

150

100

100

50

50

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Source: Standard & Poor's.

Page 3 / February 11, 2022 / S&P 500 Buybacks & Dividends

Yardeni Research, Inc.



Buybacks & Dividends

Figure 3.

300

S&P 500 BUYBACKS (billion dollars, quarterly, nsa)

200

300

Q3 200



100

100

0

0

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Source: Standard & Poor's.

Figure 4.

140

S&P 500 DIVIDENDS (billion dollars, quarterly)

120

140 Q4

120

100

100



80

80

60

60

40

40

20

20

0

0

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Source: Standard & Poor's.

Page 4 / February 11, 2022 / S&P 500 Buybacks & Dividends

Yardeni Research, Inc.



Buybacks & Dividends

Figure 5.

5

S&P 500 DIVIDENDS & BUYBACKS (trillion dollars, annualized)

4

Buybacks

3

Dividends

S&P 500 Index

5 Jan

4

3



2

2

Q3

1

1

Q4

0

0

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Source: Standard & Poor's.

Figure 6.

1000

S&P 500 BUYBACKS (billion dollars, annualized)

800

1000 Q3

800

600

600

400

400

200

200

0

0

12

12

S&P 500 FORWARD EARNINGS YIELD & CORPORATE BOND YIELD

10 (percent)

10

8

8

6

6

2/4

4

4

BoFA Merrill Lynch AAA

2

Corporate Bond Yield (2.9)

Jan 2

S&P 500 Forward Earnings Yield* (5.0) 0

0

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

* Forward earnings (time-weighted average of consensus operating earnings estimates for current and next year) divided by S&P 500 stock price index. Source: Thomson Reuters I/B/E/S, Standard & Poor's and Bank of America Merrill Lynch.

Page 5 / February 11, 2022 / S&P 500 Buybacks & Dividends

Yardeni Research, Inc.



Buybacks & Dividends

Figure 7.

1600

S&P 500 BUYBACKS & DIVIDENDS 1400 (billion dollars, annualized)

1600 Q3

1400

1200

1200

1000

1000

Total* (1243.4)

800

800

600

600

400

400

200

200

0

0

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

1000

1000 Q3

800

800

600

Buybacks* (742.2)

600

400

400

200

200

0

0

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

550

550

Q4

500

500

450

450



400

Dividends* (511.4)

400

350

350

300

300

250

250

200

200

150

150

100

100

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

*4-quarter sum. Source: Standard & Poor's.

Page 6 / February 11, 2022 / S&P 500 Buybacks & Dividends

Yardeni Research, Inc.



Buybacks

Figure 8.

600

600

TOTAL GROSS ISSUANCE OF STOCKS MINUS S&P 500 BUYBACKS

(billion dollars)

400

Total Gross Issuance

400

of Stocks Minus

S&P 500 Buybacks

200

(annualized)

200

0

0

-200

-200

-400

-600

Corporate Equities: Net Issuance

Nonfinancial Corporate Business

-800

(4-quarter sum)

-400 Q3

-600 Q3

-800

-1000

-1000

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Source: Federal Reserve Board and Standard & Poor's Corporation.

Page 7 / February 11, 2022 / S&P 500 Buybacks & Dividends

Yardeni Research, Inc.



S&P 1500/500/400/600 Divisors

Figure 9.

50000

S&P 1500 DIVISOR*

48000

46000

44000

42000

40000

S&P 1500 DIVISOR* (y/y percent change)

2/11

8 6 4 2 2/11 0 -2 -4

38000 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24

9750

S&P 500 DIVISOR*

9250

8750 2/11

8250

7750

-6 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24

10

S&P 500 DIVISOR*

(y/y percent change)

8

6

4

2 2/11 0

-2

7250 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24

-4 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24

3000

S&P 400 MIDCAP DIVISOR*

2500

2000

S&P 400 MIDCAP DIVISOR* (y/y percent change)

10 5 2/11 0 -5

1500

-10

-15

1000

2/11

-20

500 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24

-25 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24

2500

S&P 600 SMALLCAP DIVISOR*

2000

S&P 600 SMALLCAP DIVISOR* (y/y percent change)

10 5 2/11 0

1500

-5

1000 2/11

500 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24

-10

-15

-20 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24

* Divisor is used to ensure that changes in shares outstanding, capital actions, and the addition or deletion of stocks to the index do not change the level of the index. Source: Standard & Poor's Corporation.

Page 8 / February 11, 2022 / S&P 500 Buybacks & Dividends

Yardeni Research, Inc.



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