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Steel Dynamics, Inc. (STLD) has increased share repurchase authorization of the company’s common stock by up to $1 billion. Shares of the steel products manufacturer and metal recycler have gained 1.4% in the extended trading session on Tuesday.
The new authorization is in addition to the previously announced $500 million, of which $51 million remained outstanding as of June 30. The buyback plan comes with no expiration date and repurchases will be carried out as and when determined by Steel Dynamics in the open market or private transactions.
Notably, since 2016, the company has repurchased $1.6 billion of its common stock and distributed cash dividends of over $950 million through June 30. (See Steel Dynamics stock chart on TipRanks)
Chairman, President and CEO of Steel Dynamics Mark D. Millett said, “We believe the strength of our operating model, capital structure, and liquidity profile provides us the unique ability to strategically grow, while also returning value to our shareholders and remaining committed to maintaining our investment grade credit ratings.”
Last month, J.P. Morgan analyst Michael Glick initiated coverage on the stock with a price target of $107 (upside potential of 83.8% from current levels).
Glick believes that the company is one of the highest quality mini-mill steel producers in the U.S., and sees the timing of its Texas steel mill to be ideal.
Based on 9 Buys and 1 Hold, the stock has a Strong Buy consensus rating. The average Steel Dynamics price target of $73.22 implies 25.8% upside potential from current levels. Shares have gained 59% so far this year.