Stock and crypto trading platform Robinhood has authorized a $1.5 billion share repurchase program, the company said in a Securities and Exchange Commission filing. The board approved the plan, which will be executed over the next three years.
The program adds $1.1 billion in new repurchase capacity, with the remainder carried over from an earlier authorization. Robinhood Chief Financial Officer Shiv Verma said the move reflects the management team’s and board’s confidence in the company’s long-term opportunity and their ability to deliver products and create shareholder value while returning capital over time.
Share buybacks are often viewed as a signal that management believes the stock is undervalued. Robinhood’s announcement comes as its shares have faced pressure this year amid a broad downturn in equities and crypto markets.
Robinhood also disclosed that its subsidiary, Robinhood Securities, has entered a $3.25 billion revolving credit facility with JPMorgan Chase, replacing a prior $2.65 billion facility. The facility can expand by up to $1.62 billion, taking the maximum available credit to $4.87 billion.
Robinhood stock fell sharply on the day of the filing, ending Tuesday’s session down 4.7% at $69.08, its lowest close so far this year, before recovering slightly to $70.90 in after-hours trading. The shares are down about 39% year-to-date and off roughly 54.7% from their October all-time high of $152.46. Over the past 12 months, however, the stock has gained nearly 43% as the company expanded into products such as prediction markets and banking.
Analyst aggregator TipRanks places the 12-month average price forecast for Robinhood at $123.85 and classifies the stock as a “strong buy” based on 16 Wall Street analysts.
Despite the recent share-price weakness, Robinhood remains focused on crypto and tokenization initiatives. The company launched an Ethereum layer-2 testnet in February to experiment with tokenized assets, and CEO Vlad Tenev said the testnet processed about 4 million transactions in its first week of public activity. Robinhood Chain is being developed to support tokenized equities, exchange-traded funds and other traditional financial instruments, with a mainnet launch planned later this year.
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