McDonald’s (MCD), Fortune 500), the all-American fast food Mecca, announced it would put $20 billion towards share repurchases and dividends Thursday, jumping on board the buyback trend that has boomed over the past 18 months.
A $20 billion number would make any investor salivate, but when divided between buybacks and dividends, it’s pocket change compared to the share repurchase announcements other companies have made in 2014.
So far this year, companies have announced 376 share-repurchase initiatives for a total of $261 billion, according to data from Birinyi Associates. That’s nearly 72% higher than 2012, though slightly lower when compared to the same period in 2013, which was a record year for buybacks.
Repurchasing shares helps boost stock prices and many analysts credit the boom in stock repurchases for pushing the Standard & Poor’s 500 index to record highs.
Recently, however, the buyback boom has started to fade. The Standard & Poor’s 500 Buyback Index, which tracks the 100 companies with the largest share repurchase ratio, recently recorded its first quarterly decline since mid 2012. As stock prices reach record highs, the boost from share repurchases diminishes, making it more valuable for companies to invest in longer-term projects or use extra cash for acquisitions.
Here are the top 5 share repurchases authorized so far this year, according to data collected by Birinyi.
