Companies Are Spending $1 Trillion on Buybacks, But Insiders Tell a Different Story
Corporate America is pouring $1 trillion into stock buybacks, yet insider behavior may reveal what executives really think about their own shares.
There's a big gap between what companies say with their wallets and what their own executives are doing with theirs. Corporate America is on pace to spend a jaw-dropping $1 trillion on stock buybacks — a move that, on paper, signals confidence in a company's own value. Buybacks reduce the number of shares floating around, which can boost earnings per share and prop up the stock price. Sounds great, right?
But here's where it gets interesting. When you look at what corporate insiders — think CEOs, CFOs, and board members — are actually doing with their personal holdings, the picture gets a little more complicated. Insiders have access to information the rest of us don't, so when they're buying shares out of their own pockets, that tends to be a meaningful signal. When they're selling, well, that's worth paying attention to too.
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MarketWatch identified 22 U.S. stocks that have the rare combination of active corporate buyback programs AND insiders putting their own money on the line. That double-down approach is considered by many analysts to be one of the stronger vote-of-confidence signals in the market. It suggests the people who know the business best aren't just signing off on repurchase programs in boardrooms — they're also writing personal checks.
For everyday investors, this kind of screen can be a useful starting point. Buybacks alone don't guarantee a stock will outperform, and they've drawn criticism for prioritizing short-term price bumps over long-term investment in workers or R&D. But when insider buying lines up with a buyback program, it at least suggests alignment between management incentives and shareholder interests — something that isn't always a given in corporate America.
If you're looking for stocks where the people running the show have skin in the game, this list of 22 names is worth a closer look. Continue reading at MarketWatch.com.
