Softbank Stocks Surge on Plans for Shares Buyback

On Tuesday, stocks of Softbank Group Corp. surged after it announced to buy back up to $8.80 billion worth of its shares.

The Tokyo-based company soared 10.00% or 5.46 points to $60.06 per share, the biggest gain in two months. At the same, it reversed its decline of 0.77% to $54.60 yesterday. 

Accordingly, the current move reverted to the strategy that Chief Executive Officer Masayoshi Son has used to benefit investors. 

Last year, he launched a $22.16 billion buyback program that tripled the company’s valuation from its plunge brought by the pandemic. 

Then, its shares skidded more than 40.00% from their peak in March after completing the repurchase program.

Consequently, market participants repeatedly asked the firm to revive the buyback initiative.

However, Softbank deferred as it prioritized other uses for its cash, including its startup investments. 

This week, the company directors agreed on the current plan as shares significantly slumped below the value of its assets. 

Subsequently, CEO Son made the announcement after reporting third-quarter financial results. 

Correspondingly, Softbank would repurchase about 14.60% of its outstanding stock. At the same time, it would retire the shares in a program that would run for a year. 

In addition, the business mentioned that if the buyback would not be fulfilled next year, it could be extended. 

In line with this, analysts named the buyback as a “welcome move”. They also raised their price target for Softback to $69.56 with an estimated net asset value of $114.40 on holdings. 

Furthermore, CEO son confidently reassured the investors that he would complete the sale of Arm Ltd. to Nvidia Corp. This is despite worries about the persisting tech scrutiny. 

Asia-Pacific Stocks Mixed as Softbank Hike

Meanwhile, shares in the Asia-Pacific region were mixed following the gains of Japanese conglomerate SoftBank Group. 

In Japan, the Nikkei 225 index shed 0.67% or 198.79 points to $29,308.26 per share. 

Similarly, the broader TOPIX index tumbled 0.63% or 12.86 points to $2,022.36 per share. 

Also, China’s Shanghai Composite index lost 0.02% or 0.73 points to $3,497.90 per share. 

Conversely, the benchmark Shenzhen Component advanced 0.02% or 0.73 points to $3,497.90 per share. 

In Hong Kong, the Hang Seng index weakened 0.07% or 17.85 points to $24,745.92 per share. 

Elsewhere, South Korea’s KOSPI edged down 0.30% or 8.81 points to $2,951.39 per share. 

In Australia, the S&P/ASX 200 index fell 0.09% or 6.50 points to $7,445.70 per share. 

Overall, MSCI’s broadest index of Asia-Pacific stocks outside Japan elevated 0.16% or 1.04 points to $648.34 per share.

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