Record Stock Buybacks in Europe Make It Even Better Pick Than US

izsk(u0a(n6l1wmf4]mqyujo_media_dl_1.png Bloomberg, Barclays

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(Bloomberg) — Investors looking for a fresh reason to buy European stocks, or to choose it over the US, can add record buybacks to their list. 

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Members of the Stoxx Europe 600 index have announced €85.7 billion ($101 billion) of share repurchases, the highest ever for the January-February period, according to a Barclays Plc tracker. 

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Technology, financial and industrial firms have led the way so far and, with earnings-season curbs on executing buybacks lifting as companies wrap up results, the bumper returns for shareholders look set to become even larger.    

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“We’re seeing a strong acceleration in corporate activity,” said Barclays strategist Emmanuel Makonga. “Executions are already running above average, and with March typically the seasonal peak, activity should rise further as blackout windows clear.”

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Investors are rewarding companies for the repurchase spree. A Barclays basket of buyback announcers has outperformed the broader Stoxx 600 in total returns by more than five percentage points in the past six months. They’ve also outpaced a benchmark of so-called dividend aristocrats with strong payout records. 

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“This matters for markets: companies are now returning as a steady source of demand just as the post‑blackout phase historically coincides with better equity performance,” Makonga added. 

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On top of that, around 76% of buyback plans authorized by shareholders have yet to be carried out, “leaving plenty of dry powder to support flows into the second quarter,” he said.

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The numbers have been eye-catching. Rolls-Royce Holdings Plc surprised investors by unveiling its largest-ever repurchase program of as much as £9 billion ($12.1 billion) through 2028, sending its shares soaring to an all-time high. London Stock Exchange Group Plc rallied after saying it will buy back £3 billion by February next year. Banks have featured prominently, with Deutsche Bank AG, Societe Generale SA and Standard Chartered Plc pledging programs after a strong 2025 for shares in the sector.

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The flipside of all this is that investors had high expectations for shareholder returns heading into the earnings season and have shown their displeasure when let down. 

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Shares in the world’s largest publicly listed hedge fund, Man Group Plc, fell despite it notching a fresh record in assets under management. Morgan Stanley analysts saw the lack of a buyback as disappointing. BP Plc sank after halting repurchases, an unusual step for Big Oil after heaps of cash were handed to investors in recent years thanks to elevated crude prices. TotalEnergies SE reduced its share buybacks to the lower end of a guided range.

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The strong start of the year marks a re-acceleration in stock repurchase programs after a slowdown in 2025. Banks, energy and technology accounted for nearly 50% of Stoxx 600 buybacks last year, according to a Bloomberg Intelligence tracker. At the same time, dividends have continued to grow, underpinning the region’s standing as the go-to market for income strategies and adding to its appeal as an alternative to the US.  

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The Stoxx Europe 600 has outperformed the S&P 500 by six percentage points since the start of the year, as investors diversify outside of American markets, spooked by heavy spending on artificial intelligence and lofty valuations.