Stock buyback announcements took a breather last week with only 6 companies announcing buybacks. This is the lowest level of buyback activity we have seen since the start of this year and it might have to do with a combination of a long holiday weekend and the start of a new quarter. With earnings seasons starting later this month, we might also see an uptick in buyback activity.
Three out of the companies announcing buybacks during the last week, Onion Global (OG), First High-School Education Group (FHS) and Adagene (ADAG) happen to be Chinese companies. The company that managed to top the list this week, Adagene (ADAG), happens to be a net-net stock. This means its market cap is less than the company’s current assets minus total liabilities. Tonix Pharmaceuticals (TNXP) is a similar net-net biotech which made a significant buyback announcement on March 31, 2022 and we wrote about it in our Buyback Wednesdays post, on June 1, 2022.
Adagene is a clinical-stage biopharmaceutical company involved in the research, development, and production of monoclonal antibody drugs for cancers. It is a microcap company with a market cap of $87 million. The company announced a partnership with the pharma giant Sanofi (SNY) in March 2022 to develop certain immuno-oncology drugs. The company has $167 million in cash and is going to use part of this cash to fund its buyback program.
Welcome to edition 14 of Buyback Wednesdays, a weekly series that tracks the top stock buyback announcements during the prior week. The companies in the list below are the ones that announced the largest buybacks as a percentage of their market caps. They are not the largest buybacks in absolute dollar terms. A word of caution. Some of these companies could be low-volume small-cap stocks with a market cap below $2 billion.
Top 5 Stock Buyback Announcements
1. Adagene Inc. (ADAG): $2
On June 29, 2022, the Board of Directors of this biopharmaceutical company approved a new share repurchase program authorizing the company to repurchase up to $10 million of its class A common stock, equal to nearly 11% of its market cap at announcement.
| Market Cap: $87.15M | Avg. Daily Volume (30 days): 151,157 | Revenue (TTM): $10.18M |
| Net Income Margin (TTM): N/A | ROE (TTM): -66.04% | Net Cash: $167M |
| P/E: N/A | Forward P/E: N/A | EV/EBIDTA (TTM): 1.12 |
2. Onion Global Limited (OG): $0.86
On June 30, 2022, the Board of Directors of this online and direct marketing retailer approved a new share repurchase program authorizing the company to repurchase up to $10 million of its class A common stock, equal to nearly 10.8% of its market cap at announcement.
| Market Cap: $89.46M | Avg. Daily Volume (30 days): 2,627 | Revenue (TTM): $402.34M |
| Net Income Margin (TTM): -13.93% | ROE (TTM): -49.22% | Net Cash : $37M |
| P/E: N/A | Forward P/E: N/A | EV/EBIDTA (TTM): -0.92 |
3. Vermilion Energy Inc. (VET): $18.83
On June 30, 2022, the Board of Directors of this international energy producer approved a new share repurchase program authorizing the company to repurchase up to $306 million of its class A common stock equal to nearly 9.7% of its market cap at announcement.
| Market Cap: $3.15B | Avg. Daily Volume (30 days): 3,442,630 | Revenue (TTM): $1.84B |
| Net Income Margin (TTM): 40.54% | ROE (TTM): 49.89% | Net Debt: $1.15B |
| P/E: 4.5 | Forward P/E: 4.15 | EV/EBIDTA (TTM): 2.67 |
4. VerifyMe, Inc. (VRME): $2.31
On June 30, 2022, the Board of Directors of this technology solutions provider approved a new share repurchase program authorizing the company to repurchase up to $1.5 million of its class A common stock equal to nearly 9% of its market cap at announcement.
| Market Cap: $19.47M | Avg. Daily Volume (30 days): 530,936 | Revenue (TTM): $840K |
| Net Income Margin (TTM): 408.69% | ROE (TTM): 18.98% | Net Cash: $8.6M |
| P/E: 4.69 | Forward P/E: N/A | EV/EBIDTA (TTM): -2.11 |
5. DigitalBridge Group, Inc. (DBRG): $5.10
On July 5, 2022, the Board of Directors of this global digital infrastructure REIT approved a new share repurchase program authorizing the company to repurchase up to $200 million of its class A common stock equal to nearly 6% of its market cap at announcement.
| Market Cap: $3.31B | Avg. Daily Volume (30 days): 13,053,031 | Revenue (TTM): $1.22B |
| Net Income Margin (TTM): -25.48% | ROE (TTM): -5.19% | Net Debt: $4.48B |
| P/E: 11.28 | Forward P/E: N/A | EV/EBIDTA (TTM): 24.63 |
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