HERNDON, Va. - Beacon (NASDAQ:BECN), a Fortune 500 distributor of building products, has entered into an accelerated share repurchase agreement (ASR) with Citibank, N.A. The company will repurchase $225 million of its common stock as part of its ongoing share repurchase program, according to a statement released today.
Julian Francis, President & CEO of Beacon, emphasized that the move aligns with the company's strategy to enhance shareholder value, balancing investments in growth with returns to shareholders. He cited the success of Beacon's Ambition 2025 plan, which has reportedly achieved both growth and improved margins and cash flow. "This ASR further emphasizes our confidence in the resiliency of our business model and our team's strong execution," Francis stated.
In the terms of the ASR, Beacon will prepay $225 million to Citibank, N.A. and will initially receive a portion of its common stock back. The final number of shares repurchased will depend on the volume-weighted average price of Beacon's stock during the ASR period, adjusted by a discount and the terms of the agreement. The transaction is expected to be finalized in the fourth quarter of 2024.
Beacon's forward-looking statements in the press release caution investors about placing undue reliance on these projections. The company acknowledges that actual results may vary due to numerous factors and risks, as detailed in its latest Form 10-K and filings with the U.S. Securities and Exchange Commission.
Founded in 1928, Beacon operates over 550 branches across the U.S. and Canada, serving nearly 100,000 customers. The company provides roofing materials and complementary products, including its private label brand TRI-BUILT®. Beacon also offers Beacon PRO+, a digital account management platform for its customers.
This news article is based on a press release statement from Beacon without any additional insights or commentary.
InvestingPro Insights
Beacon (NASDAQ:BECN), while embarking on a share repurchase program, presents an interesting case for investors when considering the company's recent performance and future prospects. According to InvestingPro data, Beacon has a market capitalization of approximately $5.91 billion, with a notable revenue growth in the last twelve months as of Q1 2024 by 9.73%. This reflects the company's ability to expand its top-line sales, aligning with the ambitions of its growth plan. Despite a negative P/E Ratio of -153.57, analysts have a positive outlook on the company's profitability, suggesting that net income is expected to grow this year.
InvestingPro Tips reveal that Beacon's stock price movements are known to be quite volatile, which may be a consideration for investors looking for stability. However, with 7 analysts revising their earnings upwards for the upcoming period, there seems to be a consensus that the company's financial health is on an upward trajectory. Additionally, Beacon's strong return over the last year, with a 56.65% one-year price total return, underscores the company's robust performance in the market.
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