Uber Technologies Inc.’s stock 12% Wednesday, after the ride-sharing company announced its first-ever share-buyback program with its board authorizing the repurchase of up to $ 7 billion worth of stock.
The stock was on track for a fresh record close, according to Dow Jones Market Data, based on records that go back to May 10, 2019. That was the day Uber’s stock make its trading debut.
Chief Financial Officer Prashanth Mahendra-Rajah said the move was a vote of confidence in the company’s financial momentum.
“We will be thoughtful as it relates to the pace of our buyback, beginning with actions that partially offset stock-based compensation, and working towards a consistent reduction in share count,” he said in a statement.
The ride-sharing company’s virtual investor day kicked off at 8 a.m. Eastern time.
Uber previously teased a coming capital-return program, and said last week it would share more at Wednesday’s investor event.
Uber UBER, +12.31% reported fourth-quarter earnings showing net income of $ 1.4 billion, but $ 1.0 billion of that came from unrealized gains related to its equity investments.
Per-share earnings came to 66 cents, compared with 29 cents in the same period a year ago. The FactSet consensus was for 16 cents a share in earnings.
Revenue rose to $ 9.9 billion from $ 8.6 billion, while the FactSet consensus was for $ 9.8 billion. The company logged a 22% rise in gross bookings to reach $ 37.6 billion, while analysts had been looking for $ 37.1 billion.
Gross bookings captures the dollar value of transactions for which riders are charged.
Looking to the first quarter, Uber is anticipating $ 37.0 billion to $ 38.5 billion in gross bookings along with $ 1.26 billion to $ 1.34 billion in adjusted earnings before interest, taxes, depreciation and amortization (Ebitda). The FactSet consensus called for $ 37.4 billion and $ 1.26 billion, respectively.
For more, read: Uber faced high expectations into earnings, but it cleared the hurdle
The stock earlier set an new intraday high of $ 77.29. It’s the top performer on the S&P 500 Wednesday and most active in that index.
The stock has more than doubled in the last 12 months, while the S&P 500 SPX, +0.41% has gained 21%.