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Goldman Sachs (GS) Announces $30B Share Repurchase Plan

The Goldman Sachs Group GS announced that its board of directors approved a share repurchase program under which, the company may repurchase shares worth up to $30 billion. The new program replaces the company’s existing share buyback plan and has no set expiration date.

In its latest annual filing, the company also announced that it accelerated the pace of its share buybacks.

Notably, in 2022, GS repurchased $3.5 billion worth of shares. In the first quarter of 2023 through Feb 23, 2023, the company repurchased shares worth $2.25 billion.

Since March 2000, the company’s board has approved repurchases of up to 605 million shares of its common stock.

Following the coronavirus crisis in 2020, GS had suspended share repurchases. It resumed share buybacks in first-quarter 2021.

In addition to share buybacks, the company pays regular quarterly dividends.

In the third quarter of 2022, its board of directors approved a 25% increase in the quarterly common stock dividend from $2 to $2.50 per share. Prior to this hike, Goldman Sachs raised its dividend by 60% in 2020.

Considering the last day’s closing price, Goldman Sachs’ dividend yield currently stands at 2.75%. The yield is not only attractive to investors but it also represents a steady income stream.

In the last five years, the company raised its quarterly dividend five times. It has a five-year annualized dividend growth of 29.39%. Currently, the company's payout ratio is 33% of earnings.

Such efforts not only reflect the company’s commitment toward returning value to shareholders but also mirror its healthy position to endure severe economic downturns.

Given a solid liquidity position and earnings strength, Goldman Sachs is expected to continue with efficient capital deployment activities in the future. Through this, it will keep enhancing shareholder value.

Over the past six months, shares of GS have gained 9.5% compared with the industry’s growth of 12.2%.

 

Zacks Investment Research
Zacks Investment Research


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Currently, Goldman Sachs carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Share Repurchase Plans of Other Finance Firms

A few days ago, Citizens Financial Group CFG announced an addition to the company’s share repurchase program by $1.15 billion. As of Dec 31, 2022, $850 million of capacity from the previous share repurchase program remained unutilized. Hence, the total authorization is now $2 billion.

CFG’s previous share repurchase plan, announced on Jun 27, 2022, had authorized it to buy back $1 billion worth of shares. The company had suspended its buyback program in second-quarter 2021 for the Investors Bancorps’ merger and resumed the same in the fourth quarter of 2022, repurchasing $150 million in common stock in the said quarter.

In the first quarter of 2023, Citizens Financial expects to repurchase shares worth $400 million.

Last month, Zions Bancorporation ZION announced that its board of directors authorized a share repurchase for the first quarter of 2023 of up to $50 million.

In 2021, ZION repurchased 13.5 million shares for $800 million, while in 2022, it repurchased 3.6 million shares for $200 million.

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The Goldman Sachs Group, Inc. (GS) : Free Stock Analysis Report

Zions Bancorporation, N.A. (ZION) : Free Stock Analysis Report

Citizens Financial Group, Inc. (CFG) : Free Stock Analysis Report

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