SCHAUMBURG, Ill.—Shares of Motorola Inc. inched upward after the company unveiled plans to step up its stock buy-back plan.
Motorola said it will spend $1.2 billion to buy back its stock ahead of schedule as part of a $4.5 billion repurchase plan announced in May. The company also outlined a new plan to buy back $4.5 billion in stock during the next three years.
“We believe that at current price levels, Motorola shares are an attractive investment,” said Chief Financial Officer David Devonshire. “With our strong balance sheet and significant free cash flow, we maintain the flexibility to invest in our current business, take advantage of strategic opportunities, continue to repurchase our shares, pay dividends and further reduce debt.”
CIBC World Markets hailed the news, estimating that completion of the first buy-back in the third quarter could lift Motorola’s 2007 earnings per share by 2 to 3 cents.
“Motorola is now matching Nokia’s solid buyback performance,” the firm noted. “We see continued market share and margin expansion.”
Investors welcomed the news as well, sending Motorola shares up 81 cents, or 4 percent, to $21.21.
