Investing.com -- Kraft Heinz (NASDAQ:KHC) has announced that its board of directors has approved a new share buyback program worth up to $3 billion through Dec. 26, sending shares higher in premarket U.S. trading on Monday.
In a statement, the processed foods giant said it plans to repurchase shares "with excess cash" after allocating funds for other initiatives like investments in key areas of the business and strategic opportunities.
The move, which Bloomberg News estimates represents 7% of Kraft Heinz's current market value, "allow[s] us to provide further value to our stockholders while underscoring our commitment to delivering profitable growth and driving strong returns,” said Chief Executive Officer Miguel Patricio.
Kraft Heinz noted that the "timing, manner, price and amount" of any buybacks will be determined by the company "in its discretion," adding that the plan may be "modified, suspended, or discontinued at any time."
Earlier this month, the firm behind brands like Jell-O and Philadelphia Cream Cheese lifted its 2023 profit guidance for the second time this year, thanks in part to an uptick in prices and easing supply chain constraints that bolstered margins in the third quarter. Overall volume, however, dropped during its most recent three-month period, sparking concerns over the impact of the elevated pricing on inflation-squeezed consumers.
Shares in Kraft Heinz have fallen by just over 14% so far this year.