NewtekOne, Inc. (NASDAQ:NEWT), a national commercial bank headquartered in Boca Raton, Florida, has announced a new stock repurchase program authorized by its Board of Directors. Under this program, the company may repurchase up to 1 million shares of its common stock over the next twelve months. The decision was made on Friday, November 1, 2024, and the company made the announcement today.
The repurchase plan allows NewtekOne to buy back shares at its discretion, taking into account market conditions, legal requirements, capital needs, and alternative uses of capital. The company clarified that there is no obligation to repurchase any specific number of shares.
The repurchase program comes amidst a period where companies are closely monitoring their capital allocation strategies, balancing investment in growth with shareholder returns. NewtekOne's announcement does not commit the company to a specific repurchase schedule, allowing flexibility in its capital management decisions.
The information provided is based on NewtekOne's recent SEC filing and is not indicative of the company's future performance or market position.
In other recent news, NewtekOne, Inc. has been making noteworthy strides in the financial sector. The company recently completed its public offering of 8.625% Fixed Rate Senior Notes, raising an aggregate principal of $75 million.
The notes are due in 2029 and the underwriting process was led by firms such as Morgan Stanley (NYSE:MS) & Co. LLC, Keefe, Bruyette & Woods, Inc., Raymond James & Associates, Inc., and UBS Securities LLC.
NewtekOne has also seen changes in its executive team with the appointment of Craig CJ Brunet to the boards of directors of both NewtekOne, Inc. and Newtek Bank N.A. Brunet brings with him over five decades of experience in information technology and financial services.
In addition, Andrew Kaplan was appointed as the company's Chief Strategy Officer, bringing his extensive experience in banking and financial services to the team.
The company also announced the divestiture of its subsidiary, Newtek Technology Solutions, Inc., to Paltalk, Inc. The transaction involved a $4 million cash payment and 4 million shares of Paltalk's newly created preferred stock.
On the financial front, NewtekOne demonstrated financial resilience in its Q2 2024 earnings, surpassing analysts' expectations with an earnings per share (EPS) of $0.43. The company also reaffirmed its full-year EPS guidance, projecting a range between $1.85 and $2.05.
InvestingPro Insights
NewtekOne's stock repurchase program aligns with several positive indicators highlighted by InvestingPro data and tips. The company's P/E ratio of 7.7 suggests the stock may be undervalued, potentially making the buyback a strategic use of capital. This is further supported by an InvestingPro Tip indicating that NEWT is trading at a low P/E ratio relative to near-term earnings growth, with a PEG ratio of 0.45 as of Q2 2024.
The company's financial health appears robust, with an InvestingPro Tip noting that liquid assets exceed short-term obligations. This liquidity position could provide the flexibility needed to execute the share repurchase program without compromising operational stability. Additionally, NEWT has maintained dividend payments for 10 consecutive years, demonstrating a commitment to shareholder returns that complements the new buyback initiative.
With a dividend yield of 5.87% and a market capitalization of $336.23 million, NewtekOne presents an interesting profile for value-oriented investors. The company's revenue growth of 54.13% over the last twelve months and a strong gross profit margin of 83.07% suggest a solid financial foundation supporting the repurchase decision.
For investors seeking more comprehensive analysis, InvestingPro offers additional tips and insights beyond those mentioned here. The platform currently lists 7 additional tips for NEWT, providing a deeper understanding of the company's financial position and market outlook.
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