NEW YORK ( TheStreet) -- Did you notice what happened to Smith & Wesson's (SWHC - Get Report) share price when the company's board authorized the purchase of an additional $15 million of Smith & Wesson common stock, to be purchased between now and June 30, 2013?
That's not a huge stock buyback, but it helped the company's shares, which I wrote about on Dec. 21, to surge over 3% on Thursday Dec. 27. The stock traded as low as $7.95 on the 21st and closed at $8.26 on the 27th. At $8-a-share, a $15 million buyback reduces the outstanding float by 1,875,000 shares.
The additional amount was authorized after the company completed the $20 million stock repurchase program that was announced back on Dec. 6. SWHC plans to fund the repurchases using cash on hand and working capital. The point is that stock buybacks usually create an immediate benefit.
UTX will next step into the earnings confessional on Jan. 21, 2013. In the meantime it's not hard to understand why Jim Cramer and our Research Director Stephanie Link recently wrote to subscribers of ActionAlertsPlus, "UTX is a way to play the global aerospace cycle with the synergy kicker from the Goodrich acquisition, which will add as much as 70 cents to 2013 earnings.
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts