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Is there any reason why the US leads on buybacks whereas other developed (and emerging) markets lag? In principle, large multinationals like Shell, LVMH, AstraZeneca should also be able to do the same.

After the GFC, banks were hobbled by the need to raise large amounts of equity and maintain the equity buffer. The question is - what will the catalyst be to force a re-equitisation, especially of big tech?

Would there be any legislative changes that hobble the corporate bond market?

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I do think US corporates benefit from very favourable tax treatment of their overseas earnings - and share buybacks is a tax efficient way to return those earnings to US shareholders.

Japan is really getting on the share buyback wagon - but I think its really a political/social thing. Most CEOs are usually looking for the next big thing - under the influence of Warren Buffett - and seeing how much it pushes up share prices, US CEOs have really bought into the share buyback model. See Apple, Texas Instruments, McDonalds. I think it also helps to ward off private equity bidders - which again is in CEOs incentive to do...

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Tax policy undoubtedly is a factor, but it alone doesn't wholly explain the preponderance of buybacks in the US.

Is there any reason why buybacks aren't as common in the UK? Valuations in the UK are lower than the US, and the cost of debt isn't higher.

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Shell is doing the same. It's the new CEO's main strategic goal "to narrow the valuation gap with US-peers"...

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The incentive to do so would be strong

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Last paragraph sounds a bit contradictory. You start that large corporations escaped banking but end with the recommendation that smart corporates may start building equity. Why the later if the first holds true?

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Note was getting a bit long - but at some point government finances will become a problem, which I think will make capital scarce. Buying back shares on a yield below debt costs may come to be seen as foolish, when current valuations suggest raising equity, not buying it back

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Good reminder. Particularly how quickly Central Banks react to a lack of liquidity / equity.

Clearing House Compression Margin - blast from the past.

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