“Significant changes (generally considered 1% or greater for the quarter) continued to strongly favor reductions, and also increased, as 117 issues reduced their share count by at least 1%, compared to last quarter’s 101 and the 112 which did so in Q4 2013,” according to S&P Dow Jones Indices. “Share reduction change impacts of at least 4% (Q4 2014 over Q4 2013), which can be seen in EPS comparisons, were flat at 99 in Q4 2014 from Q3, but up from the 83 posted in Q4 2013.”
The SPDR S&P 500 Buyback ETF (NYSEArca: SPYB), the newest buyback ETF is also benefiting from still strong buyback trends. SPYB debuted in early February and has outpaced the S&P 500 since then.
The new ETF tracks the S&P 500 Buyback Index, which “provides exposure to the 100 constituent companies in the S&P 500 with the highest buyback ratio in the last 12 months. The buyback ratio is defined as the ratio of the total cash put towards buybacks in the trailing year and the market capitalization of the company as of a reference date,” according to a statement issued by State Street.
Like its rivals, SPYB is heavily allocated to consumer discretionary and technology names with those sectors combining for 43% of the fund’s weight.
PowerShares Buyback Achievers Portfolio
Tom Lydon’s clients own shares of TTFS.