EverCommerce Announces an Increase and Extension of its Share Repurchase Program
EverCommerce (NASDAQ: EVCM) has announced a $50 million increase in its share repurchase program, bringing the total authorization to $200 million. This program, extended through December 31, 2025, has already seen $136 million spent on repurchasing approximately 14.6 million shares. CEO Eric Remer highlighted the company's improved operational cash flow and margin expansion over the last 12-18 months as factors enabling this decision. The repurchases can occur in open market or negotiated transactions and will adhere to Rule 10b-18 and potentially Rule 10b5-1 plans. The program is funded by cash on hand and is flexible in its execution, allowing modifications or discontinuation at the company's discretion.
- Increase in share repurchase program by $50 million, totaling $200 million.
- Program extended through December 31, 2025, offering long-term flexibility.
- Company has repurchased 14.6 million shares worth $136 million.
- Improvement in operational cash flow and margin expansion over the last 12-18 months.
- Repurchases can be made in the open market or negotiated transactions, adhering to regulatory guidelines.
- Funding for repurchases will come from cash on hand, indicating strong liquidity.
- The program does not obligate the company to repurchase any specific amount of shares.
- Potential risks associated with using cash reserves for share buybacks instead of other investments.
- The company may modify, suspend, or discontinue the program at any time, creating uncertainty.
Insights
EverCommerce's announcement of a $50 million increase to its share repurchase program, extending the authorization through December 31, 2025, is noteworthy for investors. This move indicates the company's confidence in its future cash flows and profitability. Share repurchases are generally seen as a way to return capital to shareholders, potentially increasing the stock's value by reducing the number of shares outstanding.
From a financial perspective, the decision to allocate an additional
Potential benefits for shareholders include an increase in earnings per share (EPS), given the lower share count and possible support for the stock price. However, it's essential to recognize that share buybacks can sometimes indicate limited opportunities for growth investments, though the company mentions continued investments to accelerate growth. Investors should carefully monitor EverCommerce's financial health and strategic initiatives to ensure that the balance between buybacks and growth investments is well managed.
The extension and increase of EverCommerce's share repurchase program reflect the company's strategy to boost shareholder value. The repurchase could have several immediate and long-term impacts. In the short term, this action might create positive market sentiment and support the stock price, as it signals the company's belief in its undervaluation. Additionally, the reduction in share count can improve key financial metrics such as EPS and return on equity (ROE).
From a market perspective, EverCommerce operating in the SaaS solution space, a sector often characterized by high growth rates and substantial investment needs, might raise concerns about whether capital allocated for repurchases might be better spent on growth initiatives. The company aims to balance this by continuing to invest in its business to drive growth.
Investors should keep an eye on the company's ability to maintain its growth trajectory while executing its share repurchase strategy. The long-term success of this program will depend on whether EverCommerce can sustain its competitive position and capitalize on growth opportunities without compromising its financial flexibility.
DENVER, May 22, 2024 (GLOBE NEWSWIRE) -- EverCommerce Inc. (NASDAQ: EVCM), a leading provider of SaaS solutions for service SMBs, today announced that its Board of Directors has approved a
“We continue to evaluate our capital allocation priorities to maximize shareholder value,” said Eric Remer, Chairman and CEO of EverCommerce. “With the margin expansion and growth in cash flow from operations we’ve achieved over the last 12-18 months, we have the flexibility to expand our share repurchase program while also making key investments in our business that we believe can result in growth acceleration. Together with our Board of Directors, we will continue to assess the best use of capital on a regular basis.”
Repurchases under the program may be made from time to time in the open market at prevailing market prices or in negotiated transactions off the market. Open market repurchases will be structured to occur within the pricing and volume requirements of Rule 10b-18. The company may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of its shares under this authorization. This program does not obligate the company to acquire any particular amount of common stock and the program may be extended, modified, suspended or discontinued at any time at the company’s discretion. The company expects to fund repurchases with cash on hand.
Investor Contact:
Brad Korch
SVP and Head of Investor Relations
720-796-7664
ir@evercommerce.com
About EverCommerce
EverCommerce (Nasdaq: EVCM) is a leading service commerce platform, providing vertically-tailored, integrated SaaS solutions that help more than 690,000 global service-based businesses accelerate growth, streamline operations, and increase retention. Its modern digital and mobile applications create predictable, informed, and convenient experiences between customers and their service professionals. With its EverPro, EverHealth, and EverWell brands specializing in Home, Health, and Wellness service industries, EverCommerce provides end-to-end business management software, embedded payment acceptance, marketing technology, and customer experience applications. Learn more at EverCommerce.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including without limitation statements regarding the amount, timing and benefits of the share repurchase program, as well as the expected sources of funding for the share repurchase program. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, risks relating to the fact that repurchases of our common stock may not be conducted in the time frame or in the manner the company expects, or at all, and the important factors discussed under the caption “Risk Factors” in the company's Annual Report on Form 10-K for the year ended December 31, 2023, and other filings with the SEC. These factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While we may elect to update such forward-looking statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change.
FAQ
What is EverCommerce's new share repurchase authorization?
How long is EverCommerce's share repurchase program extended?
How many shares has EverCommerce repurchased so far?
What regulatory rules will EverCommerce's share repurchases follow?
How will EverCommerce fund its share repurchases?
Can EverCommerce modify or discontinue its share repurchase program?
