STMicroelectronics Announces Status of Common Share Repurchase Program
- None.
- None.
Insights
STMicroelectronics' recent share repurchase program reflects a strategic financial maneuver that can indicate confidence in the company's intrinsic value and future performance. By reducing the number of shares outstanding, the earnings per share (EPS) could potentially increase, which is often viewed favorably by investors. The repurchase of 100,316 ordinary shares at an average price of EUR 45.9199 represents a substantial investment back into the company. It is essential to consider the impact on the company's cash reserves and whether this aligns with its long-term capital allocation strategy.
Furthermore, the repurchase being executed to meet obligations from debt financial instruments exchangeable into equity indicates a preemptive approach to managing dilution and possibly debt levels. Investors should assess the balance between the benefits of reduced share count against the cost of the repurchase, including any opportunity costs of not investing that capital elsewhere.
The semiconductor industry is highly cyclical and capital-intensive, with companies like STMicroelectronics needing to balance R&D investment with shareholder returns. The share repurchase could signal management's belief that the stock is undervalued, which might be evaluated against industry P/E ratios and growth prospects. It's also indicative of the company's liquidity and ability to generate cash flow, crucial in an industry that requires constant innovation to stay competitive.
Market reactions to share buybacks can vary; some investors see it as a positive sign of self-investment and a bullish signal, while others may perceive it as a lack of better investment opportunities or a mechanism to artificially inflate stock prices. The company's future performance, market position and the broader economic environment will ultimately determine the long-term efficacy of this buyback program.
The share repurchase by STMicroelectronics is conducted under the regulatory framework of the EU Market Abuse Regulation, ensuring transparency and compliance. The disclosure of detailed transaction data is a requisite for maintaining market integrity and investor trust. It is crucial for investors to understand that such transactions are subject to strict legal requirements to prevent market manipulation and abuse.
By adhering to Article 5(2) of the Market Abuse Regulation, the company demonstrates its commitment to lawful conduct in financial dealings. The share repurchase is not just a financial decision but also a legal one, with implications for regulatory compliance and corporate governance that investors should be mindful of.
STMicroelectronics Announces Status of
Common Share Repurchase Program
Disclosure of Transactions in Own Shares – Period from Dec 18, 2023 to Dec 20, 2023
AMSTERDAM – December 27, 2023 -- STMicroelectronics N.V. (the “Company” or “STMicroelectronics”), a global semiconductor leader serving customers across the spectrum of electronics applications, announces full details of its common share repurchase program (the “Program”) disclosed via a press release dated July 1, 2021. The Program was approved by a shareholder resolution dated May 27, 2021 and by the supervisory board.
STMicroelectronics N.V. (registered with the trade register under number 33194537) (LEI: 213800Z8NOHIKRI42W10) announces the repurchase (by a broker acting for the Company) on the regulated market of Euronext Paris, in the period between Dec 18, 2023 to Dec 20, 2023 (the “Period”), of 100,316 ordinary shares (equal to
The purpose of these transactions under article 5(2) of Regulation (EU) 596/2014 (the Market Abuse Regulation) was to meet obligations arising from debt financial instruments that are exchangeable into equity instruments.
The shares may be held in treasury prior to being used for such purpose and, to the extent that they are not ultimately needed for such purpose, they may be used for any other lawful purpose under article 5(2) of the Market Abuse Regulation.
Below is a summary of the repurchase transactions made in the course of the Period in relation to the ordinary shares of STMicroelectronics (ISIN: NL0000226223), in detailed form.
Transactions in Period
| Dates of transaction | Number of shares purchased | Weighted average purchase price per share (EUR) | Total amount paid (EUR) | Market on which the shares were bought (MIC code) |
| 12/18/2023 | 45,000 | 46.072 | 2,073,240.00 | XPAR |
| 12/19/2023 | 30,000 | 45.8471 | 1,375,413.00 | XPAR |
| 12/20/2023 | 25,316 | 45.736 | 1,157,852.58 | XPAR |
| Total for Period | 100,316 | 45.9199 | 4,606,505.58 |
Following the share buybacks detailed above, the Company holds in total 8,535,034 treasury shares, which represents approximately
In accordance with Article 5(1)(b) of the Market Abuse Regulation and Article 2(3) of Commission Delegated Regulation (EU) 2016/1052, a full breakdown of the individual trades in the Program are disclosed on the ST website (https://investors.st.com/stock-and-bond-information/share-buyback).
About STMicroelectronics
At ST, we are over 50,000 creators and makers of semiconductor technologies mastering the semiconductor supply chain with state-of-the-art manufacturing facilities. An integrated device manufacturer, we work with more than 200,000 customers and thousands of partners to design and build products, solutions, and ecosystems that address their challenges and opportunities, and the need to support a more sustainable world. Our technologies enable smarter mobility, more efficient power and energy management, and the wide-scale deployment of cloud-connected autonomous things. We are committed to achieving our goal to become carbon neutral on scope 1 and 2 and partially scope 3 by 2027. Further information can be found at www.st.com.
For further information, please contact:
INVESTOR RELATIONS:
Céline Berthier
Group VP, Investor Relations
Tel: +41.22.929.58.12
celine.berthier@st.com
MEDIA RELATIONS:
Alexis Breton
Corporate External Communications
Tel: +33.6.59.16.79.08
alexis.breton@st.com
Attachment
FAQ
What did STMicroelectronics announce regarding its common share repurchase program?
What was the purpose of the repurchase transactions by STMicroelectronics?
How many treasury shares does STMicroelectronics currently hold?
