WEBINAR
Forecasting Returns with Shareholder Payout Yield
Visible Alpha’s Senior Principal Data Scientist, Ihsan Erman Saraçgil, Ph.D., presents on the key findings from his recently published white paper “Payouts: Forecasting Stock Returns with Buyback and Dividend Expectations.”
In this video, learn about the data, methodology, and key findings of the paper:
- Buybacks today form a larger part of aggregate payouts – just the top 10 biggest buyback programs accounted for at least 40% of all cash spent on buybacks in 2021.
- Aggregate payout yield expectations have significant explanatory power over the next 12-month broad market returns.
- Earnings and payouts tend to be highly correlated – the higher the expected earnings of a firm in the next 12 months, the larger the expected total payout.
- In the sample period of 2016 to April 2022, the companies expected to return capital to investors through share repurchases and dividends underperform those companies who continue to reinvest their earnings instead.