Hewlett-Packard Approves Additional $10 Billion Share Buyback
HP said it intends to use the additional share buyback to manage the dilution created by shares issued under employee stock plans and to repurchase shares opportunistically.
"HP has a strong balance sheet," said CFO and interim CEO Cathie Lesjak. "We plan to be active in repurchasing our shares, and we expect to repurchase at least $3 billion worth of our shares in our fiscal fourth quarter at current price levels. This increased authorization will ensure that we have sufficient capacity to continue to be active in repurchasing our shares prior to our fiscal fourth quarter earnings announcement in November."
HP said it repurchased approximately $2.6 billion worth of its shares in its fiscal third quarter and, as of July 31, had approximately $4.9 billion of repurchase authorization remaining under the $8 billion repurchase authorization approved by the board in November 2009. HP has approximately 2.3 billion shares of common stock outstanding.
Beyond the buyback, investors are also watching the ongoing bidding war between Hewlett-Packard and No. 2 PC maker Dell (DELL) over 3Par (PAR). The data storage solution company recently said HP's offer is the "superior proposal."