Silicon manufacturer MEMC Electronic Materials, Inc. (NYSE: WFR) announced the Board of Directors authorized a share repurchase program for up to $500 million of the company’s outstanding common stock.
The program will allow the company to purchase common stock from time to time on the open market or through privately negotiated transactions using available cash.
The announcement is positive for WRF stock, as investors have been waiting to see a productive use of the fast-growing cash balance.
At an average price of $60/share, the program would reduce the number of shares by 8.33 million, which if completed in 2008 would increase the EPS estimate by $0.15, to $4.28. This could raise the fair value of the shares by nearly $3, to $81.
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