Goldman’s ‘Buyback’ basket: CMCSA, GM, MPC, etc

Buybacks along with capital expenditures will be the largest uses of cash for corporate spending, a Goldman Sachs note pointed out.

Analysts forecast that 45% of spending will be allocated to buybacks and dividends in the third quarter.

In addition, S&P 500 (SP500) buybacks are expected to increase by 13% in 2024 and 15% in 2025.

“Relative to 2024, a modest decline in valuations and a normalization of the lending environment should support a modest reacceleration in buyback growth,” said David J. Kostin, chief U.S. equity strategist, in a note. “However, we expect interest rates will remain around current levels, constraining debt-funded buyback activity.”

Also, financials (XLF) and information technology (XLK) will likely drive the largest share of S&P 500 (SP500) buyback growth, he said.

To put together Goldman’s buyback basket, analysts look at earnings growth, valuation, rates, policy uncertainty, and credit availability for each company.

Below is the list, organized by their sectors, and the trailing 12-month yield buyback:

Communication services

• Comcast Corp. (CMCSA) – Trailing 12-month yield buyback: 7%
• Match Group (MTCH) – Trailing 12-month yield buyback: 7%
• T-Mobile US Inc. (TMUS) – Trailing 12-month yield buyback: 7%
• Fox Corp. (FOXA) – Trailing 12-month yield buyback: 6%

Consumer discretionary

• General Motors (GM) – Trailing 12-month yield buyback: 21%
• Expedia Group Inc. (EXPE) – Trailing 12-month yield buyback: 14%
• MGM Resorts International (MGM) – Trailing 12-month yield buyback: 14%
• eBay Inc. (EBAY) – Trailing 12-month yield buyback: 10%
• NVR Inc. (NVR) – Trailing 12-month yield buyback: 10%

Consumer staples

• Archer-Daniels-Midland (ADM) – Trailing 12-month yield buyback: 10%
• Bunge Global SA (BG) – Trailing 12-month yield buyback: 7%
• Monster Beverage (MNST) – Trailing 12-month yield buyback: 6%

Energy

• Marathon Petroleum (MPC) – Trailing 12-month yield buyback: 22%
• Valero Energy Corp. (VLO) – Trailing 12-month yield buyback: 12%

Financials

• American International Group (AIG) – Trailing 12-month yield buyback: 14%
• Wells Fargo & Co. (WFC) – Trailing 12-month yield buyback: 13%
• State Street Corp. (STT) – Trailing 12-month yield buyback: 12%
• Fidelity National Information Services (FIS) – Trailing 12-month yield buyback: 9%
• Citigroup (C) – Trailing 12-month yield buyback: 9%
• Corpay Inc. (CPAY) – Trailing 12-month yield buyback: 9%
• Bank of New York Mellon (BK) – Trailing 12-month yield buyback: 9%

Health care

• Incyte Corp. (INCY) – Trailing 12-month yield buyback: 15%
• DaVita Inc. (DVA) – Trailing 12-month yield buyback: 11%
• Cigna Group (CI) – Trailing 12-month yield buyback: 7%
• HCA Healthcare Inc. (HCA) – Trailing 12-month yield buyback: 6%
• Labcorp Holdings (LH) – Trailing 12-month yield buyback: 5%
• Universal Health Services (UHS) – Trailing 12-month yield buyback: 5%

Industrials

• Textron Inc. (TXT) – Trailing 12-month yield buyback: 9%
• Builders FirstSource (BLDR) – Trailing 12-month yield buyback: 9%
• RTX Corp. (RTX) – Trailing 12-month yield buyback: 8%
• Caterpillar Inc. (CAT) – Trailing 12-month yield buyback: 8%

Information technology

• Jabil Inc. (JBL) – Trailing 12-month yield buyback: 16%
• GoDaddy Inc. (GDDY) – Trailing 12-month yield buyback: 12%
• Dell Technologies (DELL) – Trailing 12-month yield buyback: 9%
• NetApp Inc. (NTAP) – Trailing 12-month yield buyback: 6%
• Gen Digital Inc. (GEN) – Trailing 12-month yield buyback: 6%
• F5 Inc. (FFIV) – Trailing 12-month yield buyback: 5%
• VeriSign Inc. (VRSN) – Trailing 12-month yield buyback: 5%
• Salesforce Inc. (CRM) – Trailing 12-month yield buyback: 5%
• Qorvo Inc. (QRVO) – Trailing 12-month yield buyback: 5%
• Akamai Technologies (AKAM) – Trailing 12-month yield buyback: 4%
• Adobe Inc. (ADBE) – Trailing 12-month yield buyback: 4%
• Fair Isaac Corp. (FICO) – Trailing 12-month yield buyback: 4%
• EPAM Systems Inc. (EPAM) – Trailing 12-month yield buyback: 4%
• HP Inc. (HPQ) – Trailing 12-month yield buyback: 4%
• TE Connectivity (TEL) – Trailing 12-month yield buyback: 4%
• Gartner Inc. (IT) – Trailing 12-month yield buyback: 3%

Materials

• DuPont (DD) – Trailing 12-month yield buyback: 9%

Real estate

• CBRE Group Inc. (CBRE) – Trailing 12-month yield buyback: 3%

Utilities

• NRG Energy Inc. (NRG) – Trailing 12-month yield buyback: 15%