What happened

Shares of Smart Share Global (EM) soared higher Wednesday, surging by as much as 69.7% before giving back some of its gains. The stock ended the trading day up 36.2%.

The consumer tech company, which provides mobile-device charging services, announced a substantial stock buyback plan, and that got investors all charged up.

So what

In a press release that dropped after Tuesday's market close, Smart Share announced that its board of directors had approved a share repurchase plan for as much as $50 million over the coming 12 months. 

A person looking at a smartphone while its charging.

Image source: Getty Images.

Now would seem an opportune time to buy back shares. Smart Share went public on April 1, pricing its shares at $8.50. The stock opened at $10, but ended its first day of trading at $8.54. It's been all downhill since then, however. As of the market close on Tuesday, shares had lost 66% of their value and were trading at $2.88.

Investors gave a collective shrug when Smart Share announced its second-quarter earnings last month. Revenue grew 53% year over year to $150.6 million, above the high end of management's previous guidance range. Unfortunately, net income slipped 72% year over year to $1.3 million. 

Now what

Investors seem to be getting a little ahead of themselves now, however. At Tuesday's closing price, spending $50 million would allow the company to retire roughly 17.36 million shares -- just 6% of its 292 million outstanding shares.

The consumer discretionary company's rise Wednesday appeared to have less to do with the anticipated reduction in its share count and more to do with general investor enthusiasm. Investors buying the stock at these levels should do so with care.