Yahoo is buying back $2 billion worth of its own shares, using proceeds from last year’s public offering of Alibaba. That’s according to an SEC filing and the buyback will be an extension of the $5 billion share buyback program Yahoo started in 2013. Shares of Yahoo have been trading right around the middle of the stock’s 52-week range. Buybacks are a common way for big companies to boost their share price. When the company buys back shares, it reduces the total number of shares available which gives a boost to each outstanding share’s price. A big part of Yahoo’s value has been tied up in its partial ownership of Alibaba shares. Alibaba’s IPO last year was the biggest public offering of 2014. Following its US listing, Yahoo sold $9.4 billion worth of Alibaba stock but still held onto 15% of the Chinese company’s shares. In January of this year, Yahoo announced plans to spin off that remaining 15%. That means that Yahoo will soon be valued only on its core business, which has been flat or down for years. This new buyback program could be a good way to calm any concerns Yahoo shareholders might have.
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