The stock of Japanese conglomerate Softbank skyrocketed on Wednesday after its CEO Masayoshi Son announced a share buyback following the company’s release of strong quarterly earnings.
In Thursday morning trade, Softbank shares surged more than 16 percent.
SoftBank Group said it would repurchase 112 million shares worth 600 billion yen (approx $5.46 billion) in the next 11 months, or about 10.3 percent of its total outstanding shares, excluding treasury stock. That came as the company announced a more than 50 percent surge in its net income for the first three quarters of the fiscal year.
Funded by proceeds from the bumper IPO of its domestic telco, Son said the buyback — the company’s largest ever, according to Reuters — was driven by what he sees as a chronic undervaluation of SoftBank’s shares.
The buyback comes after SoftBank Group raised 2.35 trillion yen in December by listing about a third of the shares in domestic telecommunications unit SoftBank Corp, which on Tuesday reported a 24 percent jump in quarterly operating profit.
— Reuters contributed to this report.
