Stock Buy Backs

According to S&P, companies in the S&P 500 bought back $110 billion of stock in the 1st quarter of 2007. That brought the trailing 4 quarters of buybacks to $442 billion, which is enough to buy the smallest 100 companies in the S&p 500. Re-read that line - in order to make in sink in! Thomson Financial tells us per share earnings growth in the S&P 500 was 8.2% in the first quarter, better than the 3.2% gain expected in early April. These massive buy backs are impacting reported eps, and even analysts have been unable to come to grips with the sheer size of the buyback programs and their impact on reported earnings per share.