Bed Bath & Beyond plans to spend nearly $3 billion buying back its own stock during the next two years after weak results earlier this year prompted a sell-off in the company’s shares.
The board of directors of Bed Bath & Beyond recently authorized a new $2 billion share repurchase program that will begin after an existing program with $861 million remaining is concluded. The announcement comes as shares of the company recently dipped below $60 after beginning the years slightly above $80. The company is currently planning that the new share repurchase program will be completed during its 2016 fiscal year, marking a significant acceleration in stock buyback activity as the company’s growth rate has decelerated after a difficult fourth quarter and first quarter.
Since 2004 through the fiscal first quarter of 2014, the company has returned approximately $6.6 billion to its shareholders through share repurchases activity and now it is poised to compress about 43% of the amount it spent during the past decade into a two year period.
"Our Board authorized this new share repurchase program based upon its continued confidence in our company's long-term growth potential, financial outlook and cash flow generation,” said company CEO Steve Temares. “We also believe this is an opportune time, and method, to return value to our shareholders. In addition to providing value to our shareholders through share repurchase programs, our strong operations should allow us to continue to invest in our infrastructure and maintain our ability to take advantage of opportunities as they may arise."