) announced that its board of directors has approved a new share
repurchase program. This will allow the market leader in open
standard based unified communications ("UC") company to buyback
shares up to $100 million. The share repurchase program is
expected to expire on May 2, 2014.
Polycom declared that the new $100 million share buyback
program is in addition to the $39 million remaining under the
previous share repurchase authorization of $800 million. The
shareholders also reacted positively to the news as the stock
price soared more than 2.52% in the Monday trade on NASDAQ.
Polycom announced that the timing and the quantity of the
share repurchase will depend on the company's cash position,
market condition and the dilutive effects of the share based
compensation plans. Nevertheless, Polycom will also take into
consideration alternative investment opportunities and working
capital needs of the company before repurchasing shares.
Polycom has sufficient cash to carry out this program. The
company exited the first quarter of fiscal 2013 with $682.8
million of cash & marketable securities and with no
outstanding debt on its balance sheet.
Recently, Polycom reported better-than-expected first-quarter
2013 financial results with both the top line and the bottom line
beating the Zacks Consensus Estimate. The company has launched
multiple new products and has entered into a strategic agreement
) to offer cloud-based video conferencing services to different
We believe that the new product launches and tie ups will
allow the company to improve its top line, while an unlevered
balance sheet will boost its bottom line, thus paving the way for
enhanced shareholders' value.
Currently, Polycom carries a Zacks Rank #2 (Buy). Other stocks
within the same industry which are worth considering are
Ubiquiti Networks Inc.
). Currently, both the stocks carry a Zacks Rank #2 (Buy).
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