European Company Profits Are Rising, But Where's the Payout?
- Windfalls for shareholders have fallen as investment recovered
- This may be partly why European shares have trailed U.S. peers
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For years, European stock investors have salivated over the payout their U.S. counterparts bagged from a rush of share buybacks. Even with earnings recovering, it looks like they may still be in for a letdown.
There have been high-profile exceptions recently, such as Unilever NV announcing a 6 billion-euro ($7.3 billion) share repurchase program. But on aggregate, profits distributed to shareholders through dividends or buybacks are near their lowest share of the euro area’s economy since the single currency was created in 1999, according to Credit Suisse Group AG.