Stock market buybacks are a great way for publicly traded companies to reward shareholders and signal confidence for 2026.



The buyback rationale is simple enough. Rather than reinvesting every dollar into projects or paying higher dividends, firms can repurchase shares, thereby lowering share count, boosting metrics (like earnings per share), and giving long-term holders more ownership per share.



“When a company’s profit, or net income, is divided by a smaller number of shares, then earnings per share rise,” said Robert R. Johnson, professor of Finance, Heider College of Business, Creighton University. “Earnings per share are net income divided by the number of shares outstanding.  If the number of shares outstanding falls, earnings per share rise.”



Here are the three best stocks investing heavily in share buybacks next year.



Buybacks favor shareholders because they are targeted at those shareholders who want them. 



“In essence, it is a targeted return on capital,” Johnson said. “When a firm pays a dividend, it goes to all shareholders. Some shareholders may want a cash return at that time, and others may not. Some don’t want a dividend because dividends are taxable.”



All shareholders benefit from a buyback, Johnson noted. “Those selling are willing sellers, and the remaining shareholders now own a slightly higher percentage of the firm (e.g., if a firm buys back 1% of all outstanding shares, remaining shareholders own 1% more of the firm),” he said.



<h2>3 Buyback-Heavy Stocks Worth Watching</h2>



Not all buybacks are created equal, as the best ones are backed by healthy cash flows, consistent capital-return policies, and a view that the stock may be undervalued.



With 2026 shaping up to be another banner year for repurchases, as firms authorize and deploy more cash to buybacks than ever before, here are three buyback stocks worth backing right now. 



All three big companies that have recently ramped up buyback programs could be innovative “buy and hold” candidates heading into the new year.



<h3>Apple Inc.</h3>



Year-to-date-performance: +10.27%



Apple’s (NASDAQ:AAPL) c-suite is in active mode in 2025, repurchasing $20 billion in stock during the third quarter and about $91 billion for the fiscal year, as of October 31.  



The share reduction helps Apple lift EPS and increases per-share ownership for long-term holders, and is especially valuable if the company continues generating massive cash flow. For investors, Apple’s size, stability, and history of disciplined capital return make it a substantial “set-it-and-forget-it” core holding, with buybacks as a semi-automatic value-add.



The world’s richest company once again led annual buybacks, spending nearly $107 billion between spring 2024 and spring 2025 alone. For long-term investors buying today, that means every quarterly EPS beat gets magnified by a shrinking share base, giving the stock an extra tailwind even before new iPhone cycles or services growth.



“Apple is a good example of companies that mix large authorizations with strong balance sheets and decent valuations,” said John Murillo, chief business officer at New York City-based B2BBroker. “AAPL has authorized over $100 billion this year, has massive free cash flow, and a long track record of reducing share count responsibly, with discipline.”



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<h3>Qualcomm Inc.</h3>



Qualcomm (NASDAQ:QCOM) is another tech sector heavyweight that’s pivoted to share buybacks, snapping up 50 million repurchased shares since November 2024, adding US$7.76 billion in capital returned to shareholders.



While it may not always top the absolute dollar charts, repurchases from companies like QCOM help underscore confidence in their core businesses (e.g., chips and licensing) even amid macroeconomic headwinds.



For growth-oriented investors comfortable with some cyclicality, QCOM offers a mix of buyback support plus exposure to the semiconductor industry (which tends to bounce with tech demand). The semiconductor firm may not have the flash of the newest AI chipmaker, but its commitment to returning cash speaks to a belief that its core business still has juice and might be undervalued, making QCOM an even better pickup right now.



“Qualcomm combines dividends with disciplined buybacks, backed by solid cash generation across handsets, automotive, and edge‑AI, so repurchases can amplify per‑share upside when the cycle improves without over‑levering,” said Kyle Dunn, a longtime market investor and founder at Commercial Mortgage Guide.



<h3>Home Depot</h3>



Year-to-date-performance: -8.11%



Home Depot (NYSE:HD) accelerated its share buyback strategy in 2023, launching a $15 billion stock repurchase program after a stellar run of quarterly earnings. However, that effort is in ‘pause’ mode in 2025 as the company focuses on debt management and steady dividends (with a 2.47% dividend yield).



At the company’s recent Investor and Analyst Day event, company officials said the home improvement giant is weathering a short-term market downturn but anticipates benefiting from market-share gains and long-term growth in home-improvement demand, with pent-up demand of around $20 billion continuing to build in 2026.



“Home Depot has long been a disciplined repurchaser, having reduced its share count by more than 35% over the past decade, supported by strong margins,” said Dan Buckley, chief analyst at DayTrading.com



<h2>Be Vigilant on Buyback Risks</h2>



Share buybacks can carry risks, market experts warn.



“If a company repurchases shares at elevated prices and then experiences weaker performance, the return on those buybacks effectively becomes negative,” said Nazzareno Spurio, chief executive officer and financial planner at Pillar Wealth Partners in Vienna, Va.



This can also erode investor confidence in management’s ability to allocate capital. “We saw examples of this in the post-pandemic market, when some firms continued buying back stock despite stretched valuations, which magnified the pain when prices corrected in 2022,” Spurio noted.



Ultimately, balance-sheet discipline determines whether a buyback program helps or harms shareholders.



Berkshire Hathaway is the gold standard here, Spurio said. “Warren Buffett only repurchases shares when they trade below his estimate of intrinsic value, and only while maintaining at least $30 billion in cash. Apple is another strong example,” he said. The company has repurchased roughly $700 billion of its own stock over the last decade, and from August 2015 to August 2025, its share price rose more than 700% (excluding dividends).



“That combination of financial strength, valuation discipline, and consistent capital return has been a powerful driver of long-term outperformance, and it remains a compelling model for other firms,” Spurio added.

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The article highlights stock buybacks as a strategy for companies to reward shareholders and signal confidence for 2026. It focuses on Apple Inc. and Qualcomm Inc., which are investing heavily in buybacks. Buybacks boost earnings per share and increase ownership for long-term holders. Successful buybacks require healthy cash flows and consistent capital-return policies.

- Stock market buybacks are a strategy for companies to reward shareholders and enhance earnings per share by reducing the number of shares outstanding.  
- Major companies like Apple, Qualcomm, and Home Depot are increasing their buyback programs, signaling confidence in their financial health and future growth.  
- However, experts caution that buybacks can pose risks if executed at high prices, emphasizing the importance of disciplined capital allocation to protect shareholder value.

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