MIDLAND, Texas - ProPetro Holding Corp. (NYSE: PUMP), a Midland-based oilfield services provider, has announced the expansion of its share repurchase program, doubling the current authorization to $200 million and extending the program until May 31, 2025. This decision, approved by the company's Board of Directors, allows for the repurchase of an additional $100 million of its common shares.
The company has already repurchased $74 million worth of its common stock, representing about 8% of the outstanding shares, since the inception of the program in May 2023. With the additional authorization, ProPetro has roughly $126 million remaining for future buybacks, which equates to approximately 14% of the company's market capitalization based on the current share price.
ProPetro's CEO, Sam Sledge, expressed confidence in the company's strategy and its ability to generate durable and repeatable results through industrialization of its business model. He emphasized that the expanded repurchase program underscores the Board's belief in the company's strategy and earnings potential.
The repurchase program will be carried out opportunistically, taking into account market conditions, the company's business outlook, capital position, and liquidity, while maintaining a robust balance sheet. The buybacks may be conducted through open market transactions, block trades, or other methods, and may be made under a trading plan in accordance with Rule 10b5-1.
ProPetro plans to fund the repurchases using cash on hand and anticipated future free cash flow. The program is discretionary and may be modified, suspended, or discontinued at any time.
The company specializes in providing completion services to upstream oil and gas companies working on unconventional oil and natural gas resources in North America. ProPetro aims to deliver reliable energy solutions and has a commitment to creating shareholder value as a core aspect of its business strategy.
This expansion of the share repurchase program is part of ProPetro's broader strategy to optimize capital allocation and deliver returns to shareholders. The information in this article is based on a press release statement from ProPetro Holding Corp.
InvestingPro Insights
As ProPetro Holding Corp. (NYSE: PUMP) embarks on the expansion of its share repurchase program, the company's financial health and market performance offer valuable insights for investors considering the implications of this strategy.
According to InvestingPro data, the company's market capitalization stands at a solid $930.46 million. This figure is especially relevant as it provides context for the repurchase program's scale, representing approximately 14% of the company's market value.
Investors may also find ProPetro's price-to-earnings (P/E) ratio noteworthy. The company's P/E ratio is currently at 11.36, while its adjusted P/E ratio over the last twelve months as of Q4 2023 is even more attractive at 6.14, suggesting that the company's earnings are robust relative to its share price. This metric can be particularly interesting for those looking at the company's earnings potential in relation to the repurchase program.
Moreover, the company's revenue growth over the last twelve months as of Q4 2023 stands at 27.4%, indicating significant growth that may underpin the Board's confidence in the company's strategy and the decision to double the share repurchase authorization.
Two InvestingPro Tips that further enrich this analysis include the company's ability to cover its interest payments with its cash flows and the moderate level of debt it operates with. These factors contribute to the financial stability of ProPetro and may reassure investors of the company's capacity to manage its buyback program without compromising its financial health.
For those seeking more detailed analysis, InvestingPro offers additional tips on ProPetro, which can be accessed through the dedicated page for the company. As of now, there are 5 more InvestingPro Tips available, providing a comprehensive look into ProPetro's financials and market performance. Interested readers can take advantage of a special offer using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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