Oil refiner and supplier PBF Energy Inc. (PBF) declared that it has got authorization from its board of directors to repurchase up to $200 million worth PBF Class A common shares. The new authorization is scheduled to expire on Sep 30, 2016.
PBF Energy will employ diverse methods like open market transactions, block trades, accelerated share repurchases, privately negotiated transactions to buy back those shares from time to time. However, the number of shares to be bought back and timing of the repurchase will be subject to price of the stock, availability of capital and legal requirements, along with the market and economic scenario. Additionally, the company is not legally responsible to buy back any of the shares under the plan and hence, can suspend the repurchase program any time.
With the buyback, the number of outstanding shares got reduced, which in turn will help to increase the market value of the remaining PBF Energy shares. Moreover, with decrease in the number of shares outstanding, earnings per share will also increase. Therefore, the buyback bodes well for shareholders.
Parsippany, NJ-based PBF Energy’s prime business is to refine crude oil and supply the refined petroleum products. PBF Energy currently carries a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months.
Meanwhile one can look at better-ranked players in the energy sector like Cheniere Energy Inc. (LNG), Patterson-UTI Energy Inc. (PTEN) and Cameron International Corporation (CAM). All these stocks sport a Zacks Rank #1 (Strong Buy).