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The Biggest Stock Buybacks of the Decade

Biggest Stock Buybacks of the Decade

When cash-rich corporations authorize a share repurchase program, investors tend to see the move as a sign of confidence in the company's prospects. Common wisdom dictates that such transactions may carry an underlying message that a stock is "undervalued," leading management to put excess cash to work by investing in their own company's stock. However, buybacks can also be interpreted by investors as an attempt to stave off a drop in share price. Although stock prices will inevitably be impacte
Photo: Getty Images

When cash-rich corporations authorize a share repurchase program, investors tend to see the move as a sign of confidence in the company's prospects.

Common wisdom dictates that such transactions may carry an underlying message that a stock is "undervalued," leading management to put excess cash to work by investing in their own company's stock. However, buybacks can also be interpreted by investors as an attempt to stave off a drop in share price.

Although stock prices will inevitably be impacted by changes in supply and demand and other market factors, how are common shares affected by a buyback? With data from Capital IQ, CNBC.com looked at some of the largest buyback programs in the past 10 years. Based on a sample of 20 of the biggest deals, valued at a minimum of $8 billion, the results show that stocks were up an average of seven percent six months after the initial announcement.

So what are the biggest stock buybacks of the past decade? How did the stocks fare? Click ahead to find out!

By Giovanny Moreano
Posted 30 March 2010

19 & 20. Hewlett-Packard (HPQ)

Transaction value: $8 billion Shares repurchased: 171 million Announcement date: 3/15/07 Date completed: 1/31/08 After 3-Mos: 15% After 6-Mos: 22% During buyback period: 10% Transaction value: $8 billion Shares repurchased: 188 million Announcement date: 11/19/07 Date completed: 1/31/09 After 3-Mos: -28% After 6-Mos: -7% During buyback period: -2%
Photo: Getty Images

Transaction value: $8 billion
Shares repurchased: 171 million
Announcement date: 3/15/07
Date completed: 1/31/08

Stock Performance
After 3-Mos: 15%
After 6-Mos: 22%
During buyback period: 10%

Transaction value: $8 billion
Shares repurchased: 188 million
Announcement date: 11/19/07
Date completed: 1/31/09

Stock Performance
After 3-Mos: -28%
After 6-Mos: -7%
During buyback period: -2%

18. Pepsico Inc. (PEP)

Transaction value: $8.5 billion Shares repurchased: ~125 million Announcement date: 5/3/06 Date completed: 8/9/08 After 3-Mos: 9% After 6-Mos: 9% During buyback period: 20%
Photo: Getty Images

Transaction value: $8.5 billion
Shares repurchased: ~125 million
Announcement date: 5/3/06
Date completed: 8/9/08

Stock Performance
After 3-Mos: 9%
After 6-Mos: 9%
During buyback period: 20%

17. Dell (DELL)

Transaction value: ~$8.5 billion Shares repurchased: 214 million Announcement date: 3/3/05 Date completed: 9/11/06 After 3-Mos: 1% After 6-Mos: -13% During buyback period: -47%
Photo: Getty Images

Transaction value: ~$8.5 billion
Shares repurchased: 214 million
Announcement date: 3/3/05
Date completed: 9/11/06

Stock Performance
After 3-Mos: 1%
After 6-Mos: -13%
During buyback period: -47%

16. McDonald's (MCD)

Transaction value: $8.89 billion Shares repurchased: ~249 million Announcement date: 10/29/01 Date completed: 9/12/07 After 3-Mos: -8% After 6-Mos: -1% During buyback period: 6%
Photo: Getty Images

Transaction value: $8.89 billion
Shares repurchased: ~249 million
Announcement date: 10/29/01
Date completed: 9/12/07

Stock Performance
After 3-Mos: -8%
After 6-Mos: -1%
During buyback period: 6%

15. Bank of America (BAC)

Transaction value:  ~$9.31 billionShares repurchased:  200 millionAnnouncement date:  3/22/05Date completed: 6/30/06 After 3-Mos: 6%After 6-Mos: -5%During buyback period: 9%
Photo: Getty Images

Transaction value:  ~$9.31 billion
Shares repurchased:  200 million
Announcement date:  3/22/05
Date completed: 6/30/06

Stock Performance
After 3-Mos: 6%
After 6-Mos: -5%
During buyback period: 9%

14. Altria (MO)

Transaction value: $10 billionShares repurchased: ~216 millionAnnouncement date:  2/1/01Date completed: 3/31/03After 3-Mos: 14%After 6-Mos: 3%During buyback period: -32%
Photo: Getty Images

Transaction value: $10 billion
Shares repurchased: ~216 million
Announcement date:  2/1/01
Date completed: 3/31/03

Stock Performance
After 3-Mos: 14%
After 6-Mos: 3%
During buyback period: -32%

13. Bank of America (BAC)

Transaction value:  $10.39 billionShares repurchased:  200 millionAnnouncement date:  4/26/06Date completed: 9/30/07After 3-Mos: 8%After 6-Mos: 15%During buyback period: 8%
Photo: Getty Images

Transaction value:  $10.39 billion
Shares repurchased:  200 million
Announcement date:  4/26/06
Date completed: 9/30/07

Stock Performance
After 3-Mos: 8%
After 6-Mos: 15%
During buyback period: 8%

12. Wal-Mart Stores (WMT)

Total transaction value: $11.6 billion Shares repurchased: 223 million* Announcement date: 5/31/07 Date completed: 6/4/09 After 3-Mos: -8% After 6-Mos: 2% During buyback period: 8% *
Photo: Getty Images

Total transaction value: $11.6 billion
Shares repurchased: 223 million*
Announcement date: 5/31/07
Date completed: 6/4/09

Stock Performance
After 3-Mos: -8%
After 6-Mos: 2%
During buyback period: 8%

*As of 4/30/09, Wal-Mart had repurchased 223 million shares for a total cost of $10.9 billion. On 3/5/09 the Board resumed the share repurchase program

11. American Express (AXP)

Transaction value: ~ $12.07 billion Shares repurchased: 220 million Announcement date: 11/18/02 Date completed: 3/31/08 After 3-Mos: 20% After 6-Mos: 9% During buyback period: 33%
Photo: Getty Images

Transaction value: ~ $12.07 billion
Shares repurchased: 220 million
Announcement date: 11/18/02
Date completed: 3/31/08

Stock Performance
After 3-Mos: 20%
After 6-Mos: 9%
During buyback period: 33%

10. AT&T (T)

Transaction value: $13.5 billion Shares repurchased: 351 million Announcement date: 3/5/06 Date completed: 12/11/07 After 3-Mos: -5% After 6-Mos: 13% During buyback period: 41%
Photo: Getty Images

Transaction value: $13.5 billion
Shares repurchased: 351 million
Announcement date: 3/5/06
Date completed: 12/11/07

Stock Performance
After 3-Mos: -5%
After 6-Mos: 13%
During buyback period: 41%

9. Citigroup (C)

Transaction value: ~$15 billion Shares repurchased: 326 million Announcement date: 4/14/05 Date completed: 8/31/06 After 3-Mos: -0.2% After 6-Mos: -2% During buyback period:8%
Photo: Getty Images

Transaction value: ~$15 billion
Shares repurchased: 326 million
Announcement date: 4/14/05
Date completed: 8/31/06

Stock Performance
After 3-Mos: -0.2%
After 6-Mos: -2%
During buyback period:8%

7 & 8. International Business Machines (IBM)

Transaction value: $15 billion Shares repurchased: 133 millionAnnouncement date: 2/26/08 Date completed: 11/30/09 After 3-Mos: 13% After 6-Mos: 12% During buyback period: 15% Transaction value: $15 billion Shares repurchased: 138 million Announcement date: 4/24/07 Date completed: 3/31/08 After 3-Mos: 18% After 6-Mos: 15% During buyback period: 17%
Photo: Getty Images

Transaction value: $15 billion
Shares repurchased: 133 million
Announcement date: 2/26/08
Date completed: 11/30/09

Stock Performance
After 3-Mos: 13%
After 6-Mos: 12%
During buyback period: 15%

Transaction value: $15 billion
Shares repurchased: 138 million
Announcement date: 4/24/07
Date completed: 3/31/08

Stock Performance
After 3-Mos: 18%
After 6-Mos: 15%
During buyback period: 17%

6. ConocoPhillips (COP)

Transaction value: $15.14 billion Shares repurchased: 192 million Announcement date: 1/12/07 Date completed: 12/31/08 After 3-Mos: 12% After 6-Mos: 38% During buyback period: -16%
Photo: Getty Images

Transaction value: $15.14 billion
Shares repurchased: 192 million
Announcement date: 1/12/07
Date completed: 12/31/08

Stock Performance
After 3-Mos: 12%
After 6-Mos: 38%
During buyback period: -16%

5. Time Warner (TWX)

Transaction value: $20 billion Shares repurchased: 1.11 billion Announcement date: 8/3/05 Date completed: 8/31/07 After 3-Mos: 3% After 6-Mos: 4% During buyback period: 9%
Photo: Getty Images

Transaction value: $20 billion
Shares repurchased: 1.11 billion
Announcement date: 8/3/05
Date completed: 8/31/07

Stock Performance
After 3-Mos: 3%
After 6-Mos: 4%
During buyback period: 9%

4. Procter & Gamble (PG)

Value of the transaction: $20.1 billion Shares repurchased: 358 million Announcement date: 1/28/05 Date completed: 7/21/06 After 3-Mos: -3% After 6-Mos: 0.1% During buyback period: 1%
Photo: Getty Images

Value of the transaction: $20.1 billion
Shares repurchased: 358 million
Announcement date: 1/28/05
Date completed: 7/21/06

Stock Performance
After 3-Mos: -3%
After 6-Mos: 0.1%
During buyback period: 1%

3. General Electric (GE)

Transaction value: $27 billionShares repurchased:  ~738 millionAnnouncement date:  12/10/04Date completed: 12/31/07After 3-Mos: 1%After 6-Mos: 2%During buyback period: 3%
Photo: Getty Images

Transaction value: $27 billion
Shares repurchased:  ~738 million
Announcement date:  12/10/04
Date completed: 12/31/07

Stock Performance
After 3-Mos: 1%
After 6-Mos: 2%
During buyback period: 3%

1 & 2. Microsoft (MSFT)

Transaction value: $36.2 billion Shares repurchased: 1.22 billion Announcement date: 7/20/06 Date completed: 8/31/08 After 3-Mos: 22% After 6-Mos: 33%During buyback period: 17% Transaction Value: $30 billion Shares repurchased: 1.16 billion Announcement date: 7/20/04 Date completed: 6/20/06 After 3-Mos: 1% After 6-Mos: -7% During buyback period: -19.3%
Photo: Getty Images

Transaction value: $36.2 billion
Shares repurchased: 1.22 billion
Announcement date: 7/20/06
Date completed: 8/31/08

Stock Performance
After 3-Mos: 22%
After 6-Mos: 33%
During buyback period: 17%

Transaction Value: $30 billion
Shares repurchased: 1.16 billion
Announcement date: 7/20/04
Date completed: 6/20/06

Stock Performance
After 3-Mos: 1%
After 6-Mos: -7%
During buyback period: -19.3%

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