Why some of the biggest companies in the U.S. are announcing buybacks

By Thomas Heath The Washington Post Mon., April 16, 2018 America’s 500 biggest public companies in 2018 are expected to distribute up to $600 billion or more through stock buybacks. Even Warren Buffett, who for more than 50 years has avoided such a move, is considering offering a buyback to his 1 million shareholders in Berkshire Hathaway. “As the subject of repurchases has come to a boil, some people have come close to calling them un-American — characterizing them as corporate misdeeds that divert funds needed for productive endeavors,” Buffett wrote in his annual letter to shareholders. “That simply isn’t the case.” Read more: Opinion | David Olive: Warren Buffett’s business sense is just plain common sense Article Continued Below How stock-market trading is becoming a lot like bitcoin trading U.S. stocks edge higher after giving back an early rally as global markets appear calmer Some of America’s best-known companies are right there with him — Cisco Systems, PepsiCo, Oracle, Wells Fargo, Amgen, eBay, Mondelez, Lowe’s, Visa and Google’s parent Alphabet have all announced stock repurchases since December. These companies and others find themselves sitting on an Everest of cash, thanks to profits pouring in faster than they can find productive ways to spend it. The profits have built up in recent years, aided by low borrowing costs, rapidly advancing technology that has reduced overhead and boosted margins, and international trade that has allowed offshore production of goods at bargain prices. The Republicans’ corporate tax cut has bought another boon… [Read full story]