Check Point Software Technologies Announces $2.0 Billion Expansion of Share Repurchase Authorization
Check Point Software Technologies (NASDAQ: CHKP) has announced a $2.0 billion expansion of its share repurchase program. As of June 30, 2024, the company had approximately 111 million shares outstanding. Since the program's inception, Check Point has repurchased about 218 million shares for a total of approximately $15 billion. The extended repurchase authorization, initially set in February 2023, is expected to be completed by Q4 2024. Repurchases will be made through various transactions, compliant with regulatory guidelines. The program's specifics, such as timing and volume, will depend on market conditions and other factors. Funding for the repurchases will come from available working capital.
- The $2.0 billion expansion demonstrates Check Point's strong financial position.
- Share repurchases can increase EPS by reducing the number of shares outstanding.
- The program reflects confidence in the company's future growth prospects.
- The share repurchase program may lead to opportunity costs by diverting funds from other investments.
Insights
Check Point Software Technologies’ $2.0 billion expansion of its share repurchase authorization is a significant move with various implications for investors. Share repurchase programs are often perceived positively by the market as they can signal that the company believes its shares are undervalued. This can lead to a potential increase in earnings per share (EPS) as there are fewer shares outstanding, which might attract more investors and support share price appreciation.
However, it is important to consider the source of funding for this program. Check Point plans to use its available working capital for the repurchases, which indicates that the company has healthy liquidity. Yet, this also means that the funds used for the buyback could have been deployed in other growth initiatives, such as Research & Development (R&D) or acquisitions, which could have long-term benefits for the company's competitiveness and innovation capacity.
From a short-term perspective, the buyback might provide a boost to the stock price, but investors should also consider the long-term impact on operational efficiency and growth strategy. The flexibility in the repurchase plan, allowing for suspension or amendment, provides Check Point with the ability to adapt to market conditions, which adds a layer of prudence.
Expanding the share repurchase program by
However, it’s important to weigh this against market conditions. If Check Point's current price is high compared to historical averages or intrinsic value, the buyback might not provide as much benefit. Additionally, the timing and execution of the buyback, contingent on market conditions and trading volumes, imply that market volatility can impact the effectiveness of this strategy.
For retail investors, this repurchase program can be seen as beneficial, particularly if it leads to sustained share price increases. Yet, they should monitor the company’s financial health to ensure that the share buyback is a part of a balanced approach to capital allocation and not at the expense of strategic investments necessary for long-term growth.
REDWOOD CITY, Calif., July 11, 2024 (GLOBE NEWSWIRE) -- Check Point® Software Technologies Ltd. (NASDAQ: CHKP), a leading provider of cyber security solutions globally, today announced that its board of directors has authorized a
As of June 30, 2024, Check Point had approximately 111 million ordinary shares outstanding, and since the beginning of the share repurchase program, Check Point has repurchased approximately 218 million shares for a total purchase price of approximately
Under the extended repurchase authorization, shares may be repurchased from time to time in open market transactions, in privately negotiated transactions or by other means in accordance with applicable securities laws and regulations. The actual timing, number and value of the shares repurchased will depend on market conditions, share price, trading volume and other factors. For all or a portion of the authorized repurchase amount, Check Point may enter into a plan that is compliant with Rule 10b5-1 of the U.S. Securities Exchange Act of 1934 that is designed to facilitate such purchases. The repurchase program does not require Check Point to acquire a specific number of shares and may be suspended from time to time, amended, or discontinued. The share repurchases are expected to be funded from available working capital.
About Check Point Software Technologies Ltd.
Check Point Software Technologies Ltd. (www.checkpoint.com) is a leading AI-powered, cloud-delivered cyber security platform provider protecting over 100,000 organizations worldwide. Check Point leverages the power of AI everywhere to enhance cyber security efficiency and accuracy through its Infinity Platform, with industry-leading catch rates enabling proactive threat anticipation and smarter, faster response times. The comprehensive platform includes cloud-delivered technologies consisting of Check Point Harmony to secure the workspace, Check Point CloudGuard to secure the cloud, Check Point Quantum to secure the network, and Check Point Infinity Core Services for collaborative security operations and services.
Legal Notice Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally relate to future events or our future financial or operating performance. Forward-looking statements in this press release include, but are not limited to, statements related to our intention to continue to repurchase our shares. Our expectations and beliefs regarding these matters may not materialize, and actual results or events in the future are subject to risks and uncertainties that could cause actual results or events to differ materially from those projected. These risks include our ability to continue to develop platform capabilities and solutions; customer acceptance and purchase of our existing solutions and new solutions; the market for IT security continuing to develop; competition from other products and services; the transition of our CEO into the role of Executive Chairman and the related succession process; and general market, political, economic and business conditions, including acts of terrorism or war. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in our filings with the Securities and Exchange Commission, including our Annual Report on Form 20-F filed with the Securities and Exchange Commission on April 2, 2024. The forward-looking statements in this press release are based on information available to Check Point as of the date hereof, and Check Point disclaims any obligation to update any forward-looking statements, except as required by law.
© 2024 Check Point Software Technologies Ltd. All Rights Reserved
| INVESTOR CONTACT: Kip E. Meintzer Check Point Software Technologies +1.650.628.2040 ir@checkpoint.com | MEDIA CONTACT: Gil Messing Check Point Software Technologies +1.650.628.2260 press@checkpoint.com |
FAQ
What is the latest expansion of Check Point Software Technologies' share repurchase program?
How many shares has Check Point repurchased so far?
When is the extended share repurchase authorization expected to be completed?
How will Check Point fund the share repurchases?
What factors will influence the timing and number of shares repurchased?
