Primis Financial Corp. Announces Reauthorization of Stock Repurchase Program
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Insights
The announcement of a new stock repurchase program by Primis Financial Corp. indicates a strategic move to potentially enhance shareholder value. The repurchase of up to 740,600 shares reflects a commitment to managing the capital structure and can signal confidence in the company's financial health and future prospects. It is crucial to evaluate the program's scale relative to the company's market capitalization and the liquidity of its shares.
Repurchases may support the stock price by reducing the supply of shares available in the market and can be accretive to earnings per share by lowering the share count used in its calculation. However, the actual impact on the market price will depend on various factors including investor perception, the size of the buyback relative to daily trading volumes and overall market conditions.
Investors should also consider the opportunity cost of the repurchase program. The funds allocated for stock repurchases are not being used for other potential growth opportunities or debt reduction. The company's previous repurchase program ended without any shares being bought back, which could raise questions about the execution of the new program and the company's allocation strategy.
From an economic perspective, the initiation of a stock repurchase program can be indicative of the company's internal assessment of its stock being undervalued. The decision to buy back shares is often made when the company's management believes that its stock is a better investment than other uses of capital, such as acquisitions or research and development.
However, the broader economic context should be considered, as repurchase programs are often more prevalent during periods of economic optimism and may slow during downturns due to capital preservation needs. The timing and execution of the buybacks, in light of general market and economic conditions, will be a critical factor in the success of the program. Furthermore, the use of a Rule 10b5-1 plan as part of the repurchase strategy allows for systematic buying that is insulated from insider trading concerns, which could be seen as a prudent legal safeguard.
In the banking sector, stock repurchase programs are a common method for managing equity capital and returning value to shareholders. The effectiveness of such a program in creating shareholder value is contingent upon the bank's performance, regulatory capital requirements and its ability to generate excess capital.
When assessing Primis Financial Corp.'s repurchase program, it is important to compare it with repurchase activities and capital management strategies of peer institutions. The financial services industry is heavily regulated and repurchases must be balanced with the need to maintain adequate capital levels. The company's adherence to Rule 10b-18 provides a framework for the repurchase program that aims to minimize the potential impact on the stock's price and volume.
Stakeholders should monitor the execution of the repurchase program closely, as deviations from announced plans can provide insights into management's confidence in the company's financial stability and its ability to navigate industry-specific challenges.
Under the Stock Repurchase Program, the Company may repurchase shares of common stock from time to time in open market purchases or privately negotiated transactions. Any open market repurchases will be conducted in accordance with the limitations set forth in Rule 10b-18 promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and other applicable legal requirements. Repurchases under the Stock Repurchase Program may also be made pursuant to a trading plan under Rule 10b5-1 under the Exchange Act, which would permit shares to be repurchased by the Company when the Company might otherwise be precluded from doing so because of self-imposed trading blackout periods or other regulatory restrictions. The extent to which the Company repurchases its shares, and the timing of such repurchases, will depend upon a variety of factors, including the performance of the Company's stock price, general market and economic conditions, regulatory requirements, availability of funds, and other relevant considerations, as determined by the Company. The Company may, in its discretion, begin or terminate repurchases at any time prior to the Stock Repurchase Program's expiration, without any prior notice. The Stock Repurchase Program does not obligate the Company to repurchase any particular number or amount of shares of common stock.
About Primis Financial Corp.
As of September 30, 2023, Primis had
Contacts: | Address: |
Dennis J. Zember, Jr., President and CEO | Primis Financial Corp. |
Matthew A. Switzer, EVP and CFO | 1676 International Drive, Suite 900 |
Phone: (703) 893-7400 | |
Primis Financial Corp., NASDAQ Symbol FRST | |
Website: www.primisbank.com |
Forward-Looking Statements
This press release and certain of our other filings with the Securities and Exchange Commission contain statements that constitute "forward-looking statements" within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements. Such statements can generally be identified by such words as "may," "plan," "contemplate," "anticipate," "believe," "intend," "continue," "expect," "project," "predict," "estimate," "could," "should," "would," "will," and other similar words or expressions of the future or otherwise regarding the outlook for the Company's future business and financial performance and/or the performance of the banking industry and economy in general. These forward-looking statements include, but are not limited to, our expectations regarding our future operating and financial performance, including our outlook and long-term goals for future growth and new offerings and services; our expectations regarding net interest margin; expectations on our growth strategy, expense management, capital management and future profitability; expectations on credit quality and performance; and the assumptions underlying our expectations.
Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties which may cause the actual results, performance or achievements of the Company to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on the information known to, and current beliefs and expectations of, the Company's management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements. Factors that might cause such differences include, but are not limited to: the Company's ability to implement its various strategic and growth initiatives, including its recently established Panacea Financial and Life Premium Finance Divisions, new digital banking platform, V1BE fulfillment service and Primis Mortgage Company; competitive pressures among financial institutions increasing significantly; changes in applicable laws, rules, or regulations, including changes to statutes, regulations or regulatory policies or practices; changes in management's plans for the future; credit risk associated with our lending activities; changes in interest rates, inflation, loan demand, real estate values, or competition; changes in accounting principles, policies, or guidelines; adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions; potential impacts of adverse developments in the banking industry highlighted by high-profile bank failures, including impacts on customer confidence, deposit outflows, liquidity and the regulatory response thereto; potential increases in the provision for credit losses; and other general competitive, economic, political, and market factors, including those affecting our business, operations, pricing, products, or services.
Forward-looking statements speak only as of the date on which such statements are made. These forward-looking statements are based upon information presently known to the Company's management and are inherently subjective, uncertain and subject to change due to any number of risks and uncertainties, including, without limitation, the risks and other factors set forth in the Company's filings with the Securities and Exchange Commission, the Company's Annual Report on Form 10-K for the year ended December 31, 2022, under the captions "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors," and in the Company's Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events. Readers are cautioned not to place undue reliance on these forward-looking statements.
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SOURCE Primis Financial Corp.
FAQ
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