Shares of Eli Lilly (NYSE:LLY) touched a new high Tuesday morning after the company said it would resume share buybacks after a multi-year hiatus and finally complete a repurchase plan it started in 2000.
The Indianapolis pharmaceutical giant said its board authorized the resumption of a share repurchase program that was started a decade ago, under which the company so far purchased $2.58 billion of an approved $3 billion.
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The last time it made any purchases on the program was in the middle of last decade. It now expects to complete the program, buying the remaining $420 million in shares, by the end of this year.
Shares of Lilly climbed early in the session and touched a 3-year high of $42.45. They are still down about 61% since 2000, when the company’s shares were as high as $107.37 and it had first authorized the $3 billion program.
The pharmaceutical giant said it plans to launch other buyback programs once it completes the current one this year.
“Based on current market valuations and our confidence in Lilly's future, we believe that now is an excellent opportunity to resume buying back Lilly shares even as we maintain the dividend at least at its current level,” the company’s chief executive, John Lechleiter, said in a statement.
Lilly also declared a quarterly dividend of 49 cents a share, payable on Sept. 10 to shareholders of record on Aug. 15.