Companies shift profits into record dividends, but show more caution on stock buybacks

Companies continued rewarding investors with healthy dividends in 2023 even as they tread more cautiously with returning profits through stock buybacks. Investors can likely expect more dividend growth through 2024, according to a recent report from Janus Henderson. At the same time, companies face more uncertainty on economic growth, inflation and interest rates, leaving them to find a better balance of paying off debt and buying back stock. The rare decline for stock buybacks globally comes amid high interest rates pressuring corporate borrowing. Buybacks still remain far higher than before the pandemic, but the path ahead is unclear.