📰 Uber Launches $1.5 Billion Accelerated Stock Buyback
The San Francisco-based company accelerates its share repurchase plan, betting on stock undervaluation.
Uber UBER 0.00%↑ has entered into a $1.5 billion accelerated share repurchase agreement with Bank of America. As part of the deal, Uber expects to receive nearly 18.6 million shares, which represents approximately 80% of the total repurchase amount. The transaction is set to close by the end of the first quarter of 2025.
This move is part of Uber’s ongoing $7 billion share repurchase program announced earlier in 2024. Uber had already spent $701 million to repurchase 10.1 million shares during the first nine months of 2024, leaving $6.3 billion remaining in the program. Uber’s stock has been performing well recently, with a 4% increase to $67.20 in premarket trading following the buyback announcement.
Uber’s leadership believes the company’s stock is undervalued relative to its business strength and growth potential, which is driving the acceleration of the buyback. With over 2.1 billion shares outstanding and a market capitalization exceeding $136 billion, Uber is focused on boosting its free cash flow and delivering long-term value to shareholders.
The accelerated repurchase deal reflects Uber's confidence in its future prospects as it continues to scale its operations, particularly through its diverse business segments like Uber Eats and freight logistics. Despite competition in these areas, Uber remains optimistic about its ability to grow, and the buyback program is seen as a way to capitalize on the company’s strong fundamentals.
Source: Marketwatch
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