Celgene is an interesting situation, a blue-chip biotech stock that has been left for dead. The stock peaked in October 2017 at $146; it has been a straight line down ever since.

The company’s recent plan to repurchase more shares and also enter into an accelerated share repurchase caught may attention.

Anadarko Petroleum Buying Back Shares

Celgene Corporation (CELG) today announced that the Company’s Board of Directors authorized the repurchase of an additional $3 billion of the Company’s common stock. In addition, the Company plans to enter into an accelerated share repurchase (ASR) agreement to repurchase an aggregate of $2 billion of the Company’s common stock. The planned ASR will utilize part of the existing Board authorized share repurchase program as well as part of the new authorization.

The remaining authorization will be used in our continuing open-ended program effective immediately. Additional stock purchases outside the ASR may be made in the open market or in privately negotiated transactions from time to time, as determined by Celgene’s management and in accordance with the requirements of the Securities and Exchange Commission.

“The increase in our share repurchase authorization and planned accelerated share repurchase program reflects our confidence in the long-term potential of Celgene,” said Mark J. Alles, Chairman and Chief Executive Officer. “Strategically, we are committed to investing in our innovative pipeline to continue to grow our portfolio and meaningfully increase shareholder value.”

Celgene is now a stock to keep on your radar, especially when the market is down multiple days in a row, it’s probably a reasonable assumption that company will be buying stock on the weak days rather than chasing momentum. The accelerated repurchase program can and will likely act as a bid for the underlying stock.

Frank Zorrilla, Registered Advisor In New York. If you need a second opinion, suggestions, and or feedback in regards to the market feel free to reach me at fzorrilla@zorcapital.com or 646-480-7463. 

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