According to analysis by Morgan Stanley, share buybacks in Europe reached approximately $17 billion in August, making it the highest August on record (+14% year-on-year). Year-to-date cumulative buybacks in Europe have now risen to ~$170 billion, an all-time high and 12% above the previous record.
Measured in U.S. dollars, the largest programs include:
- Shell: program exceeding $7 billion
- Novartis: over $6 billion
- BP: over $3.5 billion
- UBS, TotalEnergies, and SAP: over $3 billion each…
In Spain, the Ibex 35 is also contributing to this trend: Santander has completed a €1.5 billion tranche—bringing its total to €5 billion—and has just launched another plan to buy back €1.825 billion over the next one hundred days. In August, BBVA closed its €4 billion buyback program with a final tranche of €1.46 billion, while CaixaBank has already executed half of its €500 million program launched in May—an amount similar to Repsol’s ongoing buyback scheme.
Banks, oil companies, and energy firms are the main drivers of these massive buybacks aimed at boosting earnings per share (EPS). By canceling—destroying—the repurchased shares, company earnings are divided among fewer total shares. This mechanically increases EPS and supports the stock price over the long term.
Furthermore, unlike traditional dividends—which the market expects companies to maintain or increase year after year—buybacks allow businesses to pause or accelerate capital returns based on cash flow needs and economic conditions without sending negative signals to the market.
These continuous buyback programs also act as a “constant buyer” in the market, dampening severe drawdowns during sell-offs.
Tax efficiency is another major factor: in several European countries, including Spain, share buybacks are more tax-efficient for shareholders than receiving cash dividends (which are immediately taxed as investment income).
