Posted 4/13/2024, 12:11:00 PM
Stock Buybacks and Low IPOs Reduce Market Supply, Risk Further Inflating Prices
- Global net issuance of new stocks most negative since 1999 due to buybacks and lack of IPOs
- Over $1 trillion in stocks removed from markets annually via corporate buybacks
- With less supply and steady/rising demand, stock prices should continue to increase
- Private equity sitting on $2 trillion that could remove more companies from public markets
- Absent another surge in IPOs, not enough new issues to satiate growing pools of capital needing equities