The News Corporation (ASX: NWS) share price has jumped into the green today and is now changing hands 7.8% higher at $32.62.
Shares in the media giant are running hot after it snuck in an announcement on a new share buyback program yesterday.
Here's what we know.
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News Corp to double share buyback program
News Corp announced that it has authorised a US$1 billion share repurchase program with no time limit.
The program replaces the old $500 million regime that was authorised back in 2013 and represents almost 6% of News Corp's market capitalisation.
Under the arrangement, the company will purchase its own stock in the open market, which may then be "modified, suspended or discontinued at any time".
Prior to allocating capital to share buybacks, News Corp had been on the acquisition trail in 2021, folding in a number of additional ingredients into its growth recipe. Around six transactions have been completed this year, either through News Corp itself or its subsidiaries.
It appears News Corp may have pivoted away from that strategy for now in announcing the buyback program.
After all, it has a fairly robust balance sheet judging by its last earnings report, with $2.2 billion in cash, and $4.5 billion in short-term assets.
Investors appear to want a piece of the action and are driving the News Corp share price higher in afternoon trade.
What did management say?
Speaking on the buyback program, News Corp CEO Robert Thompson said:
These landmark decisions follow our most profitable year since the launch of the new News Corp in 2013 and are a tangible sign of our confidence in the inherent value and enormous potential of our businesses.
With the board's active support, we are acutely focused on long-term value for investors, balancing strategic investments and capital returns. Our robust cash balance and strong free cash flow have enabled us to launch a much larger, more aggressive buyback program that we intend to begin after our quiet period ends.
News Corp share price snapshot
The News Corp share price has gained 41% this year to date, which is well ahead of the benchmark S&P/ASX 200 index (ASX: XJO).
It has also climbed a further 57% over the past year, again outpacing the broad index's return of 25% over the same period
