3 Stocks Returning Billions to Shareholders via Buybacks

Key Points

• These three firms just announced $13.5 billion worth of new share buyback authorizations.
• One of these stocks now has a buyback capacity equal to 22% of its market capitalization.
• Huge semiconductors, gambling, and retail players find themselves on this list of companies looking to return significant capital.

Several big-name firms have announced significant new share buyback programs as Q1 2025 comes to a close. The three stocks below all have large share buyback capacity, equal to 8% or more of their market capitalizations.

Additionally, sizable dividend increases are part of the story for two of these names. Price, return, and market capitalization and other metrics use data as of the Mar. 14 close unless otherwise indicated.

Applied Materials: New Buyback Authorization Creates Nearly $18 Billion in Repurchase Capacity

The semiconductor manufacturing equipment stock Applied Materials NASDAQ: AMAT has announced a share buyback program worth a whopping $10 billion. Now, the firm has $17.6 billion in share buyback capacity, equal to nearly 14% of its $126 billion market capitalization. 

The company has made use of its buyback authorizations, having repurchased $4.4 billion worth of shares over the last four quarters. 

However, the timing of these purchases was not optimal. Shares of Applied Materials have been falling since reaching a peak in Jun. 2024. Over the last 12 months, the average price per share paid by Applied Materials for its stock was $192. The company’s share price now is $157, which is 19% lower than the average repurchase price.

The firm also announced a significant dividend increase of 15%. The new $0.46 per share payment will be payable on Jun. 12 to shareholders of record on May 22. Now, the stock has an indicated dividend yield of 1.2%, essentially in line with the yield of the S&P 500 Index. Applied Materials' dividend has grown impressively since 2017. Assuming a full-year dividend payout of $1.78 in 2025, the compound annual growth rate of Applied’s annual dividend per share is over 20%.

Churchill Downs: Racing to Return Capital to Shareholders

Gambling stock Churchill Downs NASDAQ: CHDN has approved a share repurchase program worth $500 million. Now, the company has $626 million in share repurchase capacity. This is equal to nearly 8% of the company’s $8 billion market capitalization. 

Over the last 12 months, Churchill Downs has repurchased $216 million worth of shares. This is moderately above its average last 12 months' repurchase pace of $187 million over the last 10 years. Churchill Downs does not provide a particularly impressive dividend, with a trailing 12-month yield of just 0.4%.

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The owner of the famous Churchill Downs Racetrack that hosts the Kentucky Derby has numerous parts of its business. This includes owning casinos and fairgrounds across 13 different states. In addition to being a leader in live horse racing, the company also owns one of the largest online betting platforms for horse racing called TwinSpires.

Historic racing machines (HRMs) are also a very big part of Churchill’s business. HRMs look similar to slot machines, except they use the actual results of past horse races ito determine the gamblers' outcomes. Due to this, governments view HRMs differently than slot machines. Locations where slot machines are not allowed often host HRMs, creating revenue streams that otherwise wouldn’t exist. Churchill's 2023 acquisition of Exacta Systems was key to expanding the company’s role in the HRM space.

DICK'S Sporting Goods: Steps Up to the Plate With Billions in Buybacks

DICK’S Sporting Goods NYSE: DKS announced with its latest financial results that it has also approved a share buyback program worth $3 billion. The retail company now has approximately $3.51 billion in share buyback capacity when accounting for the $511 million it still had available as of Feb. 1. 

This total capacity is equal to a stunning 22% of the firm’s nearly $16 billion market capitalization. 

This buyback capacity is very large, giving the company the ability to boost its earnings per share (EPS) significantly over time. In fiscal 2024, DICK'S spent $268 million on share buybacks, solidly below its average annual buyback pace of $430 million over the past 10 years. The average price paid for these shares was $218. The company’s share price is now 8% lower at $195.

DICK'S also announced a notable raise to its dividend of 10%. It is payable on Apr. 11 to stockholders of record at the close of business on Mar. 28. It appears the company plans to pay a total dividend of $4.85 over the next four quarters, giving the firm a solid dividend yield of 2.5%.