In this article, we discuss 5 value stocks with big buybacks. If you want to see more value stocks with big buybacks, the risk/reward, and methodology of this list, go directly to 10 Value Stocks with Big Buybacks.
5. Lowe’s Companies, Inc. (NYSE:LOW)
Q3 2022 Buybacks (Million): $3,999
Number of Hedge Fund Holders: 61
Lowe’s Companies, Inc. (NYSE:LOW) is a home improvement retailer that has a big buyback program. In addition to the company buying back nearly $4 billion worth of shares in the third quarter, the company’s board of directors also announced a $15 billion common stock repurchase program with no expiration date as of December 6, 2022.
Although higher interest rates have cooled the housing market, analysts nevertheless expect rising earnings for Lowe’s Companies, Inc. (NYSE:LOW) with consensus EPS estimates of $11.99 per share in 2022, $13.76 per share in 2023, $13.98 per share in 2024, and $15.20 per share in 2025. If its earnings per share grows in the long term and the macroeconomic climate normalizes, Lowe’s Companies, Inc. (NYSE:LOW) could be a value stock given its forward P/E ratio of 14.89.
4. The Procter & Gamble Company (NYSE:PG)
Q3 2022 Buybacks (Million): $4,000
Number of Hedge Fund Holders: 69
The Procter & Gamble Company (NYSE:PG) bought back $4 billion worth of its shares in the third quarter as the company continues to return excess capital back to shareholders through buybacks and dividends. Although inflation has been a headwind, The Procter & Gamble Company (NYSE:PG) has long term growth prospects given its strong brands and potential to gain more market share in the emerging market.
For the fiscal second quarter of 2023, The Procter & Gamble Company (NYSE:PG) reported adjusted earnings per share of $1.59 versus the expected $1.59. Total sales were $20.77 billion, slightly higher than the estimate of $20.73 billion.
3. Microsoft Corporation (NASDAQ:MSFT)
Q3 2022 Buybacks (Million): $5,573
Number of Hedge Fund Holders: 269
Microsoft Corporation (NASDAQ:MSFT) is one of the most widely held elite fund stocks given 269 hedge funds in our database owned shares at the end of the third quarter. Recently, Microsoft Corporation (NASDAQ:MSFT) has been in the news for being set to invest $10 billion in OpenAI, which makes ChatGPT at around a $29 billion valuation. Although the deal term sheet isn’t fully set out, Microsoft could own more of the company and also provide it more cloud services too. If it maintains its market share in the cloud, Microsoft Corporation (NASDAQ:MSFT) has substantial more growth left.
Microsoft Corporation (NASDAQ:MSFT) bought back $5.573 billion worth of shares in the third quarter.
Carillon Tower commented on Microsoft Corporation (NASDAQ:MSFT) in a Q3 2022 investor letter,
Despite reporting very good quarterly results, Microsoft Corporation (NASDAQ:MSFT) underperformed the overall market in August. Technology stocks in general underperformed in August due to fears over slowing global economic growth, potentially leading to cuts in corporate information technology budgets.
2. Meta Platforms, Inc. (NASDAQ:META)
Q3 2022 Buybacks (Million): $7,365
Number of Hedge Fund Holders: 177
Meta Platforms, Inc. (NASDAQ:META) has rallied in 2023 with shares up 8% year to date as the company also has substantial AI potential given its world class employees and its leading position in social media. In terms of buybacks, Meta Platforms, Inc. (NASDAQ:META) is a leader as the company bought back over $7.3 billion worth of stock in Q3.
Rowan Street Capital commented on Meta Platforms, Inc. (NASDAQ:META) in a Q4 2022 investor letter,
Meta Platforms, Inc. (NASDAQ:META) Stock declined -64% in 2022, while their revenues fell just -2% and earnings per share (EPS) declined -37% due to a ramp-up in investment expenses, which we have covered to a great extent in our recent write-up on META). Meta is our second biggest holding in the fund and one that has been a significant detractor from performance in 2022. We published a write-up back in November: Does a $750 billion decline in Meta’s market cap make sense? We strongly encourage you to read it if you have not had a chance to do so. We expect our META holding to be a solid contributor to the fund’s performance over the next several years as well.
1. Apple Inc. (NASDAQ:AAPL)
Q3 2022 Buybacks (Million): $24,736
Number of Hedge Fund Holders: 140
Apple Inc. (NASDAQ:AAPL) is a value stock given the company has a huge number of loyal iPhone buyers which the company can sell other products and services to. In terms of its future, Apple Inc. (NASDAQ:AAPL) has reportedly postponed the launch of augmented reality glasses indefinitely but is still intent on launching a mixed reality headset which could cost around $3,000.
Apple Inc. (NASDAQ:AAPL) ranks #1 on our list of 10 Value Stocks with Big Buybacks given the company bought back $24.7 billion worth of its own shares in Q3.
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