Tri Pointe Homes, Inc. Announces $250 Million Stock Repurchase Program

Rhea-AI Summary

Tri Pointe Homes (NYSE:TPH) has announced a new $250 million stock repurchase program effective through December 31, 2025. Under the previous 2024 program, the company has already repurchased 1.2 million shares at $41.57 per share in Q4 2024 (through December 17), totaling $50 million. For the full year through December 17, 2024, TPH repurchased nearly 4 million shares at $36.97 per share, amounting to $146.6 million.

The new program allows for purchases through open market transactions, block trades, or other means in accordance with federal securities laws. The company maintains flexibility in the program's execution, with no obligation to repurchase any specific amount and the ability to modify or suspend the program based on various factors including market conditions and corporate requirements.

Positive

• Authorization of new $250 million stock repurchase program through 2025
• Strong execution of previous buyback with $146.6 million in shares repurchased in 2024
• Increased average share repurchase price from $36.97 to $41.57 indicates stock value appreciation

Negative

• Higher average purchase price in Q4 ($41.57) compared to full-year average ($36.97) suggests potentially reduced value in recent buybacks

Insights

Financial Analyst

The announcement of a $250 million stock repurchase program by Tri Pointe Homes represents a substantial commitment to shareholder value enhancement, equating to approximately 7.2% of the company's market capitalization. The execution of the previous buyback program has been notably efficient, with $146.6 million deployed in 2024 at an average price of $36.97 per share. The recent acceleration in Q4, purchasing shares at $41.57, indicates management's confidence in the stock's value proposition despite higher prices. This systematic capital return strategy suggests strong free cash flow generation and robust balance sheet health. The flexible nature of the program, extending through December 2025, provides management with strategic optionality to capitalize on market volatility. The company's demonstrated willingness to execute buybacks at increasing price levels reflects an internal valuation assessment that sees continued upside in the stock.

Market Research Analyst

The timing and scale of this buyback program is particularly strategic within the current housing market context. With mortgage rates showing signs of potential moderation and homebuilder sentiment improving, TPH's aggressive capital return strategy positions it advantageously in the sector. The average repurchase price trend from $36.97 to $41.57 in Q4 demonstrates management's conviction in the company's intrinsic value amid improving market conditions. The program's size relative to daily trading volumes suggests careful consideration of market impact and liquidity. For context, at current price levels, this authorization could reduce the outstanding share count by approximately 5-6 million shares, potentially providing meaningful EPS accretion. The structured approach to repurchases, including the potential for 10b5-1 plans, indicates a sophisticated capital management strategy that aligns with best practices in corporate finance.

INCLINE VILLAGE, Nev., Dec. 18, 2024 (GLOBE NEWSWIRE) -- Tri Pointe Homes, Inc. (the “Company”) (NYSE:TPH) today announced that its Board of Directors has approved a new stock repurchase program authorizing the repurchase of up to $250 million of common stock through December 31, 2025 (the “Repurchase Program”), which succeeds the stock repurchase program that the Board of Directors authorized in December 2023 (the “2024 Repurchase Program”). For the fourth quarter through December 17, 2024, under the 2024 Repurchase Program, the Company repurchased 1,202,913 shares of common stock at a weighted average price per share of $41.57 for an aggregate dollar amount of $50.0 million. For the full year through December 17, 2024, under the 2024 Repurchase Program, the Company repurchased 3,964,537 shares of common stock at a weighted average price per share of $36.97 for an aggregate dollar amount of $146.6 million.

Purchases of common stock pursuant to the Repurchase Program may be made in open market transactions effected through a broker-dealer at prevailing market prices, in block trades, or by other means in accordance with federal securities laws, including pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. The Company is not obligated under the Repurchase Program to repurchase any specific number or dollar amount of shares of common stock, and it may modify, suspend, or discontinue the Repurchase Program at any time. Company management will determine the timing and amount of any repurchases in its discretion based on a variety of factors, such as the market price of the Company’s common stock, corporate requirements, general market economic conditions, legal requirements, and applicable tax effects.

About Tri Pointe Homes®

One of the largest homebuilders in the U.S., Tri Pointe Homes, Inc. (NYSE: TPH) is a publicly traded company operating in 12 states and the District of Columbia, and is a recognized leader in customer experience, innovative design, and environmentally responsible business practices. The company builds premium homes and communities with deep ties to the communities it serves—some for as long as a century. Tri Pointe Homes combines the financial resources, technology platforms and proven leadership of a national organization with the regional insights, longstanding community connections and agility of empowered local teams. Tri Pointe has won multiple Builder of the Year awards, was named to the 2024 Fortune World’s Most Admired Companies™ list, is one of the 2023 Fortune 100 Best Companies to Work For® and was designated as one of the PEOPLE Companies That Care® in 2023 and 2024. The company was also named as a Great Place To Work-Certified™ company for four years in a row (2021 through 2024), and was named on several Great Place to Work® Best Workplaces lists (2022 through 2024). For more information, please visit TriPointeHomes.com.

Forward-Looking Statements

Various statements contained in this press release, including those that express a belief, expectation or intention, as well as those that are not statements of historical fact, are forward-looking statements. These forward-looking statements may include, but are not limited to, statements regarding our strategy, projections and estimates concerning the timing and success of specific projects and our future production, land and lot sales, operational and financial results, including our estimates for growth, financial condition, sales prices, prospects, and capital spending. Forward-looking statements that are included in this press release are generally accompanied by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “future,” “goal,” “guidance,” “intend,” “likely,” “may,” “might,” “outlook,” “plan,” “potential,” “predict,” “project,” “should,” “strategy,” “target,” “will,” “would,” or other words that convey future events or outcomes. The forward-looking statements in this press release speak only as of the date of this press release, and we disclaim any obligation to update these statements unless required by law, and we caution you not to rely on them unduly. These forward-looking statements are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond our control. The following factors, among others, may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements: the effects of general economic conditions, including employment rates, housing starts, interest rate levels, home affordability, inflation, consumer sentiment, availability of financing for home mortgages and strength of the U.S. dollar; market demand for our products, which is related to the strength of the various U.S. business segments and U.S. and international economic conditions; the availability of desirable and reasonably priced land and our ability to control, purchase, hold and develop such parcels; access to adequate capital on acceptable terms; geographic concentration of our operations; levels of competition; the successful execution of our internal performance plans, including restructuring and cost reduction initiatives; the prices and availability of supply chain inputs, including raw materials, labor and home components; oil and other energy prices; the effects of U.S. trade policies, including the imposition of tariffs and duties on homebuilding products and retaliatory measures taken by other countries; the effects of weather, including the occurrence of drought conditions in parts of the western United States; the risk of loss from earthquakes, volcanoes, fires, floods, droughts, windstorms, hurricanes, pest infestations and other natural disasters, and the risk of delays, reduced consumer demand, and shortages and price increases in labor or materials associated with such natural disasters; the risk of loss from acts of war, terrorism, civil unrest or public health emergencies, including outbreaks of contagious disease, such as COVID-19; transportation costs; federal and state tax policies; the effects of land use, environment and other governmental laws and regulations; legal proceedings or disputes and the adequacy of reserves; risks relating to any unforeseen changes to or effects on liabilities, future capital expenditures, revenues, expenses, earnings, synergies, indebtedness, financial condition, losses and future prospects; changes in accounting principles; risks related to unauthorized access to our computer systems, theft of our homebuyers’ confidential information or other forms of cyber-attack; and additional factors discussed under the sections captioned “Risk Factors” included in our annual and quarterly reports filed with the Securities and Exchange Commission. The foregoing list is not exhaustive. New risk factors may emerge from time to time and it is not possible for management to predict all such risk factors or to assess the impact of such risk factors on our business.

Investor Relations Contact:
InvestorRelations@TriPointeHomes.com, 949-478-8696

Media Contact:
Carol Ruiz, cruiz@newgroundco.com, 310-437-0045

FAQ

How much is Tri Pointe Homes' (TPH) new stock repurchase program worth?

Tri Pointe Homes' new stock repurchase program is worth $250 million and runs through December 31, 2025.

How many shares did TPH repurchase in Q4 2024?

TPH repurchased 1,202,913 shares at an average price of $41.57 per share in Q4 2024 (through December 17), totaling $50 million.

What was TPH's total share repurchase amount for 2024?

Through December 17, 2024, TPH repurchased 3,964,537 shares at an average price of $36.97, totaling $146.6 million.

When does TPH's new stock repurchase program expire?

The new stock repurchase program expires on December 31, 2025.

What methods can TPH use to repurchase shares under the new program?

TPH can repurchase shares through open market transactions, block trades, or other means in accordance with federal securities laws, including trading plans under Rule 10b5-1.