Three mega-cap names recently announced billions in share repurchase authorizations. Mega-cap generally refers to stock with market capitalizations of $200 billion or more. Below, I’ll detail exactly how large the buyback authorizations these huge firms have approved are. I’ll also include data on how big these buybacks are in relation to the value of the company. A larger percentage increases the ability of the buybacks to have a positive effect on the company’s share price. All figures use data as of the Feb. 14 close.
Merck: Strong Buyback Capacity, Banking on Pipeline for +$50 Billion in Future Sales
[content-module:MarketRank|NYSE:MRK]First up is Merck & Co., Inc. (NYSE: MRK), one of the top 10 largest pharmaceutical companies in the world. It has a market capitalization of $210 billion. At the end of January, the company announced it had authorized an additional $10 billion buyback program. On the company’s Q4 earnings call, Chief Financial Officer Caroline Litchfield stated that this increases the firm’s total buyback capacity to $12 billion. Thus, the company now has a buyback capacity equal to around 5.7% of its market cap. The firm also declared a $0.81 dividend. This is the same payment it declared in the previous quarter. It now has an indicated dividend yield of 3.9%.
Currently, the company’s two most important drugs by far are Keytruda and Gardasil/Gardasil 9. Keytruda sales continue to grow strongly, increasing 21% last quarter. However, Gardasil/Gardasil 9 saw sales retreat 18%. This was largely due to lower Chinese demand as a result of the country’s “soft” economy. With Keytruda’s patent exclusivity ending in 2028 and declining Gardasil/Gardasil 9 sales, the firm needs to find new blockbuster drugs to replace them. The firm sees over $50 billion in sales potential for drugs in its pipeline. However, it will need to achieve many regulatory approvals and execute rollouts well to actually make this happen.
ServiceNow: Billions in Buybacks, DOGE-Related Opportunity
[content-module:MarketRank|NYSE:NOW]ServiceNow (NYSE: NOW), the information technology firm whose cloud software automates tech workflows, has announced a buyback authorization of $3 billion. The company now has nearly $3.3 billion in buyback capacity when adding in the $266 million left over at the end of last quarter. Now, its buyback capacity equates to 1.6% of its total market cap. The firm continues to grow sales at a solid clip. Its subscription revenue increased by 21% last quarter. Its remaining performance obligations, an indicator of future revenue, increased even faster at 26%. In total, its RPOs sit at $22.3 billion. That is over seven times the revenue the firm brought in last quarter, indicating a strong ability to continue increasing sales.
One of the firm's biggest growth drivers is its agentic AI tools. Its “AI-fueled” Pro Plus subscription level saw the number of customer deals for the product rise by 150% in just one quarter. Another interesting note is the company’s excitement surrounding the Department of Government Efficiency (DOGE). The company believes its solutions can be key to helping the United States government save money and modernize its outdated systems. With $125 billion spent by the U.S. government on IT annually, it sees a large opportunity that DOGE may accelerate.
Cisco: Announced $15 Billion Buyback Authorization as AI Demand Picks Up
[content-module:MarketRank|NASDAQ:CSCO]Cisco Systems (NASDAQ: CSCO), a tech giant worth $258 billion, just announced a share buyback program worth $15 billion. This brings the company’s total buyback capacity to $17 billion. This figure equates to 6.6% of the firm's total market cap. The firm also increased its quarterly dividend by $0.01 to $0.41 per share. This was the firm’s 14th consecutive annual dividend increase. Now, the firm has an indicated dividend yield of 2.5%. Overall, the company has returned $6.4 billion to shareholders over the past two quarters.
The company’s shares rose by nearly 4% in the two days following its fiscal Q2 2025 Feb. 12 earnings release. The company is starting to see demand for its solutions in AI infrastructure pick up. Orders for AI infrastructure were $350 million, bringing its total orders to $700 million in the fiscal year. It says it is now on track to have AI infrastructure orders exceed $1 billion in fiscal 2025. Still, this is largely a drop in the bucket compared to the over $56 billion in revenue the firm expects to generate in the fiscal year. However, it could become a much more significant part of the business over time.
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