NCR Lifts Guidance and Share Repurchase Plan for 2016

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NCR Corp. (NYSE: NCR) was up sharply on Monday morning following an update to its annual guidance and the announcement of a share repurchase plan. This company recently completed a much larger repurchase plan over the course of 2015.

A recent release from the company announced the commencement of further repurchases of its common stock under its previously disclosed April 1999 and November 2000 authorized share repurchase programs. The repurchases, which resumed in February, are expected to total $250 million in 2016. These repurchases follow NCR’s successful $1 billion share repurchase in December 2015.

Note that NCR has a total market cap of $ billion, while the current repurchase program is just less than 10% of that.

Taking into account these share repurchases, NCR is updating its full year 2016 guidance for its earnings per share (EPS) to a range of $2.85 to $2.95 from its previous range of $2.72 to $2.82. The consensus estimates call for $2.75 in EPS on $6.18 billion in revenue for the 2016 full year. In addition to updating full-year 2016 diluted EPS guidance, NCR also reaffirmed its full-year and first-quarter guidance previously provided in its earnings call back in February 2016.

Bill Nuti, chairman and CEO of NCR, commented:

Share repurchases are an important part of our capital allocation strategy. Further, these repurchases are an indication of our confidence in future free cash flow, and our belief that the current stock price is very attractive.

So far in 2016, NCR is relatively flat in terms of its performance. However, over the past 52 weeks the stock is down 15%.

Shares of NCR were trading at $25.63 midday Monday, with a consensus analyst price target of $26.44 and a 52-week trading range of $18.02 to $36.50.