Shares of Boyd Gaming (NYSE: BYD) rose in Thursday’s after-hours session after the regional casino operator announced the addition of $500 million to a previously unveiled share repurchase program.
Boyd also declared a quarterly dividend of 17 cents per share, which was in line with what the operator announced earlier this year. In May, the Las Vegas-based gaming company announced a $500 million share buyback plan, adding to that with today’s news.
Considering the additional authorization, the Company had approximately $843 million remaining in repurchase authority as of September 30, 2024,” according to a statement.
Based on its market capitalization of $6.6 billion as of the close of US markets today, Boyd could affect a significant reduction in its shares outstanding count should it proceed with repurchasing $843 million of its stock. However, companies are not legally obligated to buy back the entirety of an announced buyback scheme.
Buybacks Boosting Boyd Stock
Boyd’s previous buyback announcement was well-timed, arriving soon after the stock tumbled following a tepid first-quarter earnings release.
The gaming company delivered that news on May 13 when the stock closed $54.58. It closed at $74.83 today ,near a 52-week high, indicating that Boyd not only realized favorable pricing in its repurchases, but those efforts also contributed to an impressive rebound by the stock over the past six months.
Boyd’s execution of buybacks when its share price was depressed is notable because companies across all industries are often criticized for poorly timed repurchases, or buying their own stock when the share price is elevated and not doing so when the stock is slumping
Today’s buyback announcement is Boyd’s fourth since June 2022, all of which have been in the amount of $500 million and those plans complement the operator’s quarterly dividend which was reinstated in February 2022 and has since boosted twice.
Boyd Buybacks Helping in Other Ways
The Orleans operator’s pair of 2024 repurchase announcements have the added benefit of easily absorbing the large amount of stock dumped earlier this year by insiders.
In the first quarter, insiders at the gaming company dumped a significant amount of shares. In a less than three-week stretch spanning February 20 through March early March, Boyd insiders, including Chairman Emeritus Bill Boyd — son of the company’s founder Sam Boyd — and CEO Keith Smith sold approximately $53.4 million worth of the stock.
Boyd runs 10 gaming venues in its home market, including Aliante, California, Cannery, Fremont, Gold Coast, Jokers Wild, Main Street Station, Sam’s Town, Suncoast, and The Orleans. It also operates regional casinos in Illinois, Indiana, Iowa, Kansas, Louisiana, Mississippi, Missouri, Ohio, and Pennsylvania. The company also owns a 5% interest in online sports wagering behemoth FanDuel.
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