Shares of Mercantile Bank Corporation MBWM have gained 2.9% since late last week after the company announced the renewal of its share buyback plan. Now, Mercantile Bank can repurchase shares worth up to $20 million.
The repurchases can be made from time to time in open market transactions at prevailing market prices or by other means in accordance with federal securities laws. The plan might be discontinued any time.
The company’s president and CEO, Robert B. Kaminski, Jr., stated, “We are pleased to renew our stock repurchase program, which we believe is a valuable capital management tool to support shareholder value. This plan reflects our continued confidence in Mercantile's financial condition and earnings performance prospects.”
Notably, in May 2019, Mercantile Bank’s board of directors authorized the $20-million worth share buyback program. As of Mar 31, 2021, $6.3 million worth of authorization remained available for repurchase.
In addition to buybacks, the company pays regular quarterly dividends. The latest dividend of 29 cents per share, announced on Apr 15, 2021, will be paid out on Jun 16 to shareholders of record as of Jun 4.
Considering the last day’s closing price, the company’s dividend yield currently stands at 3.5%.
Supported by its earnings strength, Mercantile Bank is expected to continue with efficient capital deployment activities in the future. Through this, it will keep enhancing shareholder value.
So far this year, shares of the company have gained 20.5% compared with 27.2% growth recorded by the industry it belongs to.
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Currently, Mercantile Bank sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Share Buybacks Announced by Other Finance Companies
In April 2021, Civista Bancshares, Inc. CIVB announced that its board of directors approved a stock repurchase program to purchase up to $13.5 million worth of common shares. Also, UMB Financial Corporation UMBF approved a repurchase plan to buy back up to 2 million shares.
Further, Regions Financial Corporation RF announced that it will repurchase up to $2.5 billion of its common stock from the second quarter of 2021 through the first quarter of 2022.
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