Shares of financial technology company PROG Holdings (PRG -0.17%) jumped as much as 22.7% in early trading after announcing earnings and a large share buyback. The biggest pop didn't last long, but shares are still up 15.1% at 2:30 p.m. EDT.
Third-quarter revenue was up 6.4% to $650.4 million, and net earnings from continuing operations fell from $74.6 million a year ago to $57.4 million, or $0.86 per share. Analysts were expecting revenue of $678.4 million and earnings of $0.90 per share, so last quarter's results weren't what drove the stock today.
Management also announced intent to purchase $425 million of stock in a modified Dutch auction. This will repurchase about 15% of the company's stock, and management estimates a price of $44 to $50 per share. This is part of a $1 billion share-repurchase program, which the company expects to use to return money to shareholders.
Financial results weren't all that impressive, but any company buying back 15% of its stock should get investors' attention. Management said the asset-light business model PROG Holdings has deployed allows it to buy back stock while it grows the business. Right now, they're putting money behind that thesis, and investors are buying into the stock as a result today.