JPMorgan Sees $600 Billion Surge in U.S. Stock Buybacks by 2025

JPMorgan strategists have projected that the scale of U.S. stock buybacks could increase by an additional $600 billion in the coming years. This projection is driven by the expectation that buybacks will continue to limit stock supply, a trend that has been particularly pronounced in recent years.

The strategists, led by Nikolaos Panigirtzoglou, anticipate that the buyback volume will reach a record high of $1.5 trillion by 2025. This surge is expected to be fueled by a rebound in buyback activity to pre-pandemic levels, where buybacks accounted for 3% to 4% of the stock market's value, compared to the current 2.6%.

In a report to clients, the strategists noted, "The momentum of U.S. buybacks has been a significant driver of the stock market's rise this year and is likely to become even stronger in the coming years."

From January to August 2025, global stock buybacks have already reached the levels seen throughout the entire previous year. The strategists highlighted that the combination of robust buyback activity and a sluggish IPO market has resulted in a continuous negative supply of stocks.

Panigirtzoglou and his colleagues stated, "From a supply perspective, publicly traded stocks continue to be strongly supported, with the number of shares outstanding continuing to decline. This marks the fourth consecutive year of such a trend, which is unprecedented."

Buybacks have been a significant factor in the performance of U.S. stocks this year. As of the current year, stocks with the highest buyback-to-market-cap ratio have outperformed an equally weighted S&P 500 benchmark index by nearly 6 percentage points.

However, other factors could potentially curb buyback activity. Goldman Sachs strategists, led by Ben Snyder, noted earlier this week that the growth in buybacks by S&P 500 companies has stalled after a record-setting first half of the year.

Snyder and his team wrote, "Unless stock valuations unexpectedly decline or AI investments sharply slow down, high interest rates and surging capital expenditures will constrain buyback growth."