Improving Fundamentals Drive New Buybacks for 3 Strong Performers
When a stock performs strongly, it often means that the fundamentals of a company’s business are moving in the right direction. Unwarranted hype or speculative trading can drive rallies as well, but these tend to be exceptions rather than the rule. One way to tell that strong fundamentals drive a stock’s gain is by what management does with its cash.
When management feels confident in its business and that fundamentals influence appreciation, share buybacks are a key avenue they often turn to.
Below, we’ll detail three stocks performing well in 2025, notching higher returns than the S&P 500 Index. These stocks also announced significant new buyback programs, indicating that management is confident in their direction.
Sprouts Kicks Off $1 Billion Buyback on Record Free Cash Flow
First up is arguably the hottest grocery stock over the past several years, Sprouts Farmers Market (NASDAQ: SFM). Indeed, Sprouts' three-year return of approximately 386% is the highest among all U.S. large-cap stocks in the consumer staples sector. Sprouts' pace of appreciation has moderated significantly in 2025, but shares are still up over 13%.
That eclipses the 11% return of the S&P 500. The company is making a big move, announcing a $1 billion share repurchase authorization on Aug. 19.
The program is substantial for the firm, which is approximately $14.1 billion, equating to around 7.1% of its market capitalization. This allows the company to significantly lower its outstanding share count over time and provide a tailwind to its earnings per share (EPS).
This decision comes as the firm’s cash flow generation has improved significantly. Last quarter, Sprout’s free cash flow over the previous twelve months (LTM) hit $502 million, a record level. Importantly, Sprouts has not been afraid to engage in share buybacks.
Since the beginning of 2021, Sprouts has lowered its outstanding share count by approximately 17%. Its new buyback program indicates that further reductions are coming, supporting shares.
Dave Adds Big Time Buyback Capacity as Revenue Accelerates
Next up is a stock that has also achieved massive gains, albeit in a much more recent time frame. Personal finance company Dave (NASDAQ: DAVE) has seen its share price rise 421% over the past 52 weeks, and 139% in 2025.
In Q2, Dave’s revenue growth accelerated to 64%, the company’s fastest quarterly growth rate in more than five years. The firm’s adjusted net income growth was even more impressive, spiking 233% to nearly $46 million. In mid-August, Dave announced a new $125 million share buyback program, underscoring the significant improvements in its fundamentals.
Notably, the company has around $62 million in cash and had interest expense of only $3.5 million over the last six months. Dave’s LTM cash from operations also hit an all-time high of $192 million. These strong figures can allow the firm to execute its buyback program, which is equal to 4.4% of its market capitalization. Dave traditionally has not used buybacks much.
The new program signals that its share count could start to fall rather than increase as it has over the past few years.
GCT Now Holds Over 11% Buyback Capacity
The last name on our list is GigaCloud Technology (NASDAQ: GCT), whose shares are up 43% in 2025. The logistics company, which provides solutions for shipping large packages, recently announced a $111 million share buyback program.
The firm has shed the “meme stock” label it garnered in 2022. In Q2 2025, revenues were up 160% compared to Q2 2022. The company’s LTM free cash flow also hit a record of $162 million, and the firm has a current ratio of 2.1x, indicating strong liquidity.
However, the stock does face volatility, and management noted that buybacks are a way to reduce this. Still, the stock’s 31% spike on Aug. 8 came due to its strong earnings report that saw big beats on sales and adjusted EPS, not speculation.
The new buyback authorization equals a massive 11.1% of the firm’s market capitalization. This can allow the firm to continue lowering its share count, which it has done consistently over the past year.
Better Fundamentals = Bigger Buybacks
Overall, these three firms are seeing big improvements in their fundamentals, and management is rewarding shareholders as a result.
If their businesses continue to improve, management could announce even larger buyback programs in the future.
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