Share buybacks propel earnings

first_imgNEW YORK – The companies in the Standard & Poor’s 500 index have reported 16 straight quarters of double-digit earnings growth. If upcoming reports show that this spectacular growth continued in the second quarter, earnings per share might be pushed into double digits not because of stellar performance, but thanks to share buybacks and higher interest rates. Share buybacks have become a big-money endeavor. The cash-laden companies in the S&P 500 spent 45 percent of their capital expenditures on stock buybacks last year, which was especially significant because capital expenditures were on the upswing. Thanks to buybacks, the S&P 500 companies now hold 10 percent of their market value in company-owned stock, according to Howard Silverblatt, senior index analyst at S&P. Companies have never bought back this much stock before, Silverblatt said. Exxon Mobil Corp. has bought back its own shares 22 quarters in a row. Media company Tribune Co. at the end of June repurchased 15 percent of its outstanding shares. AD Quality Auto 360p 720p 1080p Top articles1/5READ MORE11 theater productions to see in Southern California this week, Dec. 27-Jan. 2Sunoco Inc. approved $500 million in buybacks in early July. Retailer Limited Brands Inc. approved $100 million in buybacks at the end of June; it has already spent $70 million on buybacks under a previous $100 million plan. The shares don’t disappear when a company buys them back; they just sit in the company’s treasury. But when a company computes its earnings per share, those repurchased shares aren’t counted. Removing them from the earnings per share calculation can make the figure look much better than it would have otherwise. Within the S&P 500, earnings per share at 108 companies increased by at least 4 percentage points thanks to buybacks, according to S&P. Exxon Mobil, for instance, made headlines with its $8.4 billion first-quarter earnings. The company’s earnings per share rose 12.3 percent. But without buybacks, earnings for the quarter were only 6.9 percent higher, according to S&P. “Companies are buying back so much stock that you don’t even need a strong sales performance to get these double-digit EPS (earnings per share) any more,” David Rosenberg, North American Economist at Merrill Lynch & Co., wrote in a recent note. Once a company has bought back shares, it can cancel them, which is rare. It can reissue them, or it can use them for mergers and acquisitions, which Silverblatt feels is the most likely scenario for the shares that have been bought back. Buybacks aren’t the only factor goosing earnings; higher interest rates are also helping. The S&P 500 companies have an eye-popping $631 billion in cash. Their interest income on that cash increased 34 percent last year. This year S&P expects it to rise 60 percent. S&P expects the earnings for the S&P 500 to increase 11.1 percent this year. Of that, 1.3 percent is expected to come from the companies’ increase in cash income thanks to higher interest rates.160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set!last_img read more

A Valentine’s Workplace Tale

first_imgTHIS BLOG SHOULD NOT BE CONSTRUED AS LEGAL ADVICE, PERTAINING TO SPECIFIC FACTUAL SITUATION OR ESTABLISHING AN ATTORNEY-CLIENT RELATIONSHIP. Well, there are now fewer calls to the phone banks of plaintiffs’ lawyers’ as most problems resulting from holiday parties already have been raised.  But plaintiffs’ lawyers have no fear: there will be a salvo of calls after Valentine’s Day.  And that reminds me of a story.It is 9:00 a.m.  A secretary reports to her desk.  Waiting for her is a sealed card.The secretary opens the envelope and it is a Valentine’s Day card from her manager.  Having undergone sensitivity training, the manager signs it “fondly” as opposed to “lovingly.”The employee is creeped out and goes to HR. HR talks with the manager based on a script we had prepared together.HR asks the manager if he knows why the card is inappropriate.  He responds “No.”HR asks the manager to whom else he gave a Valentine’s Day card and he answers, “his wife.”  Again, it is asked:  “Do you know why card was inappropriate?”  Again, he answers “No.”We now take out the crow bar.  Is there anything you do with your wife in privacy that you don’t do with secretary?  Ding. Ding. Ding.Of course, we did not directly ask the last question, but we get the message across.We explained to him that employees can be “so sensitive” when their bosses tell them:To the love of my lifeI cherish our moments togetherI love youRecommendation: A little email education on this issue to your managers now could save your company a lot of money later.  It’s not complicated: don’t give employees in your chain of command, or over whom you have direct or indirect influence, a Valentine’s Day card. There is some risk in giving cards to peers. But in the absence of a power differential, that risk is less.Of course, that does not mean that everyone who sends a Valentine’s Day card is intending to convey a romantic message.  After all, there are now Valentine’s Day cards for parents, kids, etc.For some, the Valentine’s Day card is simply a way to say you are important to me.  The problem is the nature of the holiday may confuse the reason as to why the employee is important.Yes, Valentine’s Day this year falls on a Saturday, so there will be fewer cards. That means even hungrier plaintiffs’ lawyers to fall in love with you.last_img read more

Infographics What are they

first_imgAdvertisement Over  the past  many years, information flow over the internet has taken different trends in such a way that the need to create an atmosphere in which people will keep wanting to know more and more is key. A picture is worth a thousand words – based on this, infographics would carry hundreds of thousands of words, yet if you let a reader choose between a full-length 1000-word article and an infographic that needs a few scroll-downs, they’d probably prefer absorbing information straight from the infographic.Infographics have been around for many years and recently the proliferation of a number of easy-to-use, tools have made the creation of infographics available to a large segment of the population. Social media sites such as Facebook and Twitter have also allowed for individual infographics to be spread among many people around the world,  Away from the internet, infographics are commonly used in newspapers  to show the weather, as well as maps, site plans, and graphs for statistical data.Infographics have gone through a number of generations dating back to   around 7500 BCE when Early humans created cave paintings and maps, artifacts that could be considered the very first instances of infographics.Fast forward to the 21st Century, By the year 2000, Adobe Flash-based animations on the Internet had made use of many key practices in creating infographics in order to create a variety of products and games. With the rise of alternatives to Adobe Flash, such as HTML 5 and CSS3, infographics are now created in a variety of media with a number of software tools – Advertisement – The big Questions are“ What are Infographics?,“How are they created?”To make this article relevant, I will attempt to answer both questions using  an  infographicThe use of infographics not only save on time, but also increases the level of creativity which is what many writers are looking forward to and the sooner this is realized, the easier it will be for information to be passed on to the intended audience in the quickest way possible. One of the companies that has made it a priority to make use of infographics is BIT REBELS  because  they can testify to the impact of infographics.While not everyone can make infographics from scratch, there are tools available on the Web that will help you create your very own infographics. In this article, am listing more my top 3 to help you get your messages across to your readers, visually.What about me.What About Me?” is a personalization tool that produces colorful infographics that display your social media habits automatically from Facebook, Twitter and YouTube. The tool is provided by Intel.Create an infographic of your digital life and become inspired by the people you know, the things you see, and the experiences you have allows you to create an online resume format that is beautiful, relevant and fun, all with just one click. It enables you to express your professional accomplishments in a simple yet compelling personal visualization, and will help optimize your LinkedIn Profile to get a kickass Visual Resume.PictochartWith Piktochart, you get to create an innovative Infographic using a combination of different types of visualizations: themes, icons, vectors, images and chart exporter. Drag-and-drop and click your way through color schemes, shapes and fonts, then export the materials as static or html to easily embed it for use at your site.There are very many tools that can be used to create infographics as long as you have the summary of the information you intend to put across.last_img read more