American Vanguard Announces $15M Share Repurchase – Buyback Wednesdays

Key Insights:

• American Vanguard Corporation (AVD) expects to more than double its EBITDA by 2025, making this company a possible growth story.
• Recent insider purchases at AVD combined with a stock buyback announcement provide a double signal.
• The company has gradually repurchased shares in recent years, implying this announcement is likely to translate into actual buybacks that reduce the share count.

When I came across American Vanguard Corporation (AVD) among the list of companies that announced stock buybacks recently, the name stood out to me not just because it is an unusual name for an agriculture focused company but also because I had been seeing a string of insider purchases at the company before the buyback was announced.

AVD is a supplier of agricultural products, specializing in a diverse selection of chemicals for safeguarding crops from pests and promoting their overall health. The company has eight businesses operating in Australia, Costa Rica, Brazil, Mexico, Latin America and the United States. Its products are distributed through national distribution companies, buying groups, co-operatives, sales offices and wholly-owned distributors.

On May 25, 2023, AVD announced a $15 million share repurchase program which represents around 3% of its market cap at announcement. Since 2021 AVD has been engaged in a gradual share buyback initiative. Approximately 4.75% of its outstanding shares have been retired during this period. Throughout 2022 and 2023, the company repurchased a total of 761,985 shares of its common stock at an average price of $19.11 per share for a total of $14.56 million.

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