- Credit/debit card firm has $3.9 billion of previous scheme to invest
- S&P 500 companies on track for record buybacks year
- Mastercard shares have rallied 26% in 2024
The board of Mastercard (MA:NYSE) has approved a new share buyback scheme worth $12 billion of its Class A shares, about 1.3% of its total share capital.
Mastercard, one half of the world’s debit and credit card duopoly with Visa (V:NYSE), said the new share repurchase programme will only become effective after the completion of its ongoing $11 billion scheme, which still has approximately $3.9 billion worth of shares left to be bought back, as of 13 December.
Mastercard stock closed overnight flat at $531, with pre-market data pointing to modest $3 gains when Wall Street reopens later today. The stock has rallied 26% this year.
US STOCK REPURCHASE BOOM
Many of the US’s biggest companies have continued buying back their own shares at a frenzied pace in 2024. Data up to mid-October 2024 showed US listed companies had announced plans to buy back about $1.1 trillion worth of stock, according to fund flows data from EPFR.
That’s nearly 18% higher than the $943.4 billion announced at a similar point in 2023. Ultimately, companies unveiled plans to buy back $1.2 trillion of stock last year, the highest on record. This year’s total is on track to be even higher.
BIGGEST BUYBACK EVER
In May 2024, Apple (AAPL:NASDAQ) unveiled the biggest corporate share repurchase scheme ever, worth $110 billion.
According to S&P data, S&P 500 companies spent $226.6 billion on share buybacks in the third quarter of 2024, down 4% from Q2, but 22.1% up on 2023’s $185.6 billion in Q3.
The soaring levels of cash being pumped into share buybacks schemes comes despite a tax on stock repurchase transactions imposed by the Biden administration a couple of years ago.
