STOUGHTON, Mass. - Collegium Pharmaceutical , Inc. (NASDAQ:COLL) has entered into an agreement to repurchase $35 million of its common stock through an Accelerated Share Repurchase (ASR) arrangement with Jefferies LLC. This buyback is a part of a larger $150 million share repurchase program that was authorized by Collegium's Board of Directors earlier this year, with $115 million remaining after the completion of this transaction.
The agreement stipulates that Collegium will receive an initial delivery of approximately 888,889 shares, which is about 80% of the expected total repurchase under the ASR, based on Collegium's closing stock price of $31.50 on May 10, 2024. The final number of shares to be repurchased will be determined by the volume-weighted average price of Collegium's stock during the ASR term.
Collegium's Chief Financial Officer, Colleen Tupper, expressed confidence in the company's financial and strategic performance, citing strong cash generation and momentum in prescription growth for their products Belbuca® and Xtampza® ER, as well as the Nucynta Franchise authorized generic agreement.
These factors are expected to contribute to meeting the company's 2024 financial guidance and improving the outlook for 2025 and beyond.
The final settlement of the ASR is anticipated to be completed in the third quarter of 2024. Collegium, a specialty pharmaceutical company focused on serious medical conditions, had approximately 32.7 million shares outstanding as of March 31, 2024.
This news is based on a press release statement.
InvestingPro Insights
As Collegium Pharmaceutical, Inc. (NASDAQ:COLL) embarks on its share repurchase journey, real-time data from InvestingPro provides a deeper insight into the company's financial health and market performance. Collegium's management has been notably aggressive in buying back shares, indicating a strong belief in the company's intrinsic value and future prospects. Additionally, with a high shareholder yield, investors might see this as a signal of the company's commitment to returning value.
InvestingPro data shows that Collegium boasts a market capitalization of $1.03 billion and a Price to Earnings (P/E) ratio of 13.6, which adjusts to a more attractive 10.56 when looking at the last twelve months as of Q1 2024. This adjustment suggests that the company is potentially undervalued based on its earnings. Moreover, the company has experienced a revenue growth of 8.0% over the last twelve months as of Q1 2024, highlighting its ability to increase sales and potentially enhance shareholder value over time.
Despite recent market volatility, with the stock experiencing a significant hit over the last week, Collegium's long-term investors might be encouraged by the strong return of 36.54% over the past year. This is complemented by a substantial price uptick of 25.05% over the last six months, suggesting a recovering trajectory.
For investors looking to delve deeper into Collegium Pharmaceutical's performance and prospects, there are additional InvestingPro Tips available. These include expectations of net income growth this year and analysts revising their earnings upwards for the upcoming period, which can be found at https://www.investing.com/pro/COLL. To gain full access to these insights and more, readers can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, offering an even more comprehensive investment analysis tool.
With 12 additional InvestingPro Tips listed for Collegium, investors can make more informed decisions backed by real-time metrics and expert analysis.
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