ST. LOUIS - Bunge Global SA (NYSE: NYSE:BG), an agribusiness and food company, has announced the authorization of an additional $500 million for its share repurchase program. This expansion, authorized by the company's Board of Directors on November 13, 2024, adds to the approximately $800 million remaining from the previous authorization as of September 30, 2024, bringing the total available for share repurchases to approximately $1.3 billion.
CEO Greg Heckman commented on the decision, stating that share repurchases play a significant role in the company's capital allocation framework. He mentioned that the additional authorization would provide Bunge with increased capacity to execute further repurchases, utilizing proceeds from the recent sale of the company's interest in a sugar and bioenergy joint venture.
The repurchase program does not have a set expiration date and may be carried out through open market transactions, privately negotiated transactions, or other methods as deemed appropriate by Bunge, in accordance with legal requirements. This includes the possibility of repurchases under a Rule 10b5-1 trading plan, which permits the company to buy back shares at times when it might otherwise be precluded from doing so due to securities laws or self-imposed trading blackouts.
The timing and volume of the repurchases will be subject to market conditions and other factors. Bunge reserves the right to modify, suspend, or discontinue the program at any time without notice.
This information is based on a press release statement from Bunge Global SA.
In other recent news, Bunge Limited's third-quarter earnings per share (EPS) decreased to $2.29 from $2.99 in the same period last year, primarily due to costs associated with its pending merger with Viterra. Net earnings per share also fell to $1.56 from $2.47. Despite these declines, Bunge maintains a strong liquidity position and anticipates an adjusted EPS of at least $9.25 for the full year.
BMO Capital Markets has lowered its price target for Bunge to $110 from $120, citing uncertainties in the current environment. However, the firm continues to rate the stock as Outperform. Similarly, CFRA has reduced its price target from $109.00 to $90.00, maintaining a Hold rating on the stock.
The Viterra merger, which is expected to dilute Bunge's EPS in the first year, is now anticipated to close by the end of the year or early 2025. This is a delay from the prior guidance. As part of its repurchase plan associated with the Viterra deal, Bunge has repurchased $200 million in shares year-to-date.
Despite the short-term costs of strategic growth initiatives, Bunge is poised for long-term growth, supported by a solid liquidity position and ongoing investments in its core businesses. These are the recent developments in Bunge, providing investors with a snapshot of the company's financial health and future plans.
InvestingPro Insights
Bunge Global SA's recent authorization of an additional $500 million for its share repurchase program aligns with one of the key InvestingPro Tips: "Management has been aggressively buying back shares." This aggressive buyback strategy demonstrates the company's confidence in its own stock and its commitment to returning value to shareholders.
Despite the challenging market conditions reflected in the company's financial metrics, Bunge has maintained a strong dividend policy. An InvestingPro Tip highlights that Bunge "has raised its dividend for 4 consecutive years" and "has maintained dividend payments for 24 consecutive years." This consistent dividend growth, coupled with a current dividend yield of 3.09%, may appeal to income-focused investors.
The company's financial health appears solid, with InvestingPro Data showing a Price to Earnings (P/E) ratio of 11.32, which is relatively low compared to many stocks in the market. This could indicate that Bunge's stock is potentially undervalued, especially considering the InvestingPro Fair Value of $99.15, which is higher than the previous closing price of $88.06.
It's worth noting that InvestingPro offers 13 additional tips for Bunge Global SA, providing investors with a more comprehensive analysis of the company's financial position and market outlook. These insights can be particularly valuable given the company's recent strategic moves and the evolving landscape of the agribusiness sector.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.