Peoples Bancorp Announces Authorization of Stock Repurchase Plan
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Insights
An increase in a stock repurchase program, as announced by Peoples Bancorp of North Carolina, Inc., signifies an important strategic financial decision. The authorization to buy back an additional $2 million in shares, raising the 2023 total to $4 million, reflects the company's confidence in its financial stability and commitment to enhancing shareholder value.
From a financial perspective, this move can be interpreted as the company's belief that its stock is undervalued. By reducing the number of shares outstanding, earnings per share (EPS) could increase, potentially leading to a higher stock price. It's also a signal to the market that the company's leadership believes in the intrinsic value of their stock, which may be a positive indicator for investors.
However, share repurchases can also indicate that the company may not have enough profitable reinvestment opportunities, which could be a concern for long-term growth prospects. The impact on the company's cash reserves and the opportunity cost of not investing in expansion or innovation must be considered.
Within the banking sector, stock repurchase programs are common mechanisms for returning capital to shareholders, particularly when institutions are well-capitalized. Peoples Bank's decision falls within industry norms, especially given the current market conditions where banks are experiencing substantial deposits and looking for ways to deploy excess capital.
Investors should note that such repurchase programs are subject to market conditions and legal requirements, which introduces a level of uncertainty about the timing and extent of buybacks. The expiration date set for February 29, 2024, provides a time frame for the execution of this program, but does not guarantee completion.
Peoples Bank's asset size and equity position, as of September 30, 2023, suggest a solid capital structure, which is essential for the continuation of such programs without compromising regulatory capital requirements.
NEWTON, NC / ACCESSWIRE / December 19, 2023 / Peoples Bancorp of North Carolina, Inc. (NASDAQ:PEBK), the parent company of Peoples Bank, Newton, NC announced today that its Board of Directors has authorized an updated stock repurchase program, whereby up to an additional
Any purchases under the Company's repurchase program may be made periodically as permitted by securities laws and other legal requirements in the open market or in privately-negotiated transactions. The timing and amount of any repurchase of shares will be determined by the Company's management, based on its evaluation of market conditions and other factors. The repurchase program may be suspended at any time or from time-to-time without prior notice.
"The Board's decision to repurchase stock was based on the strength of the Company's balance sheet and capital position. We believe this is an appropriate way to utilize capital and enhance shareholder value," said Lance Sellers, President and Chief Executive Officer.
Peoples Bank currently operates 17 banking offices entirely in North Carolina, with offices in Catawba, Alexander, Lincoln, Mecklenburg, Iredell and Wake Counties. The Bank also operates loan production offices in Lincoln, Mecklenburg, Rowan and Forsyth Counties. The Company's common stock is publicly traded and is quoted on the Nasdaq Global Market under the symbol "PEBK."
Statements made in this press release, other than those concerning historical information, should be considered forward-looking statements pursuant to the safe harbor provisions of the Securities Exchange Act of 1934 and the Private Securities Litigation Act of 1995. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management and on the information available to management at the time that this release was prepared. These statements can be identified by the use of words like "expect," "anticipate," "estimate," and "believe," variations of these words and other similar expressions. Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. Factors that could cause actual results to differ include, but are not limited to, (1) competition in the markets served by the Bank, (2) changes in the interest rate environment, (3) general national, regional or local economic conditions may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and the possible impairment of collectibility of loans, (4) legislative or regulatory changes, including changes in accounting standards, (5) significant changes in the federal and state legal and regulatory environment and tax laws, (6) the impact of changes in monetary and fiscal policies, laws, rules and regulations and (7) other risks and factors identified in the Company's other filings with the Securities and Exchange Commission, including but not limited to those described in the Company's Annual Report on Form 10-K for the year ended December 31, 2022.
Contact:
Lance A. Sellers
President and Chief Executive Officer
Jeffrey N. Hooper
Executive Vice President and Chief Financial Officer
828-464-5620
SOURCE: Peoples Bancorp of North Carolina, Inc.
View the original press release on accesswire.com
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