History Says Nvidia's Record $150 Billion Buyback Is Good News for the Stock

Nvidia announced a record $150 billion addition to its share repurchase authorization, bringing the total to $235 billion. Historical data shows that large buyback announcements at both Apple and Nvidia have typically preceded 12-month periods of stock outperformance versus the S&P 500. However, the author argues that the underlying cash generation driving these buybacks, rather than the buybacks themselves, is the primary driver of stock gains. At current valuations, Nvidia trades at 15x expected fiscal 2028 earnings compared to Apple's 36x, making Nvidia's buyback more accretive per dollar spent.