Pfizer

(PFE) - Get Report

said Thursday that its board of directors authorized a stock buyback worth $5 billion.

At today's market price, the stock repurchase would involve about 172.4 million shares, or 2.3% of Pfizer's common stock outstanding based on first-quarter records.

The company said its purchases would be made periodically on the open market or through privately negotiated deals. Pfizer completed a $5 billion stock buyback in October.

"This new buyback program capitalizes on Pfizer's financial and operational strength to increase shareholder value," says Hank McKinnell, Pfizer's chairman and chief executive.

Pfizer's stock is off 15.2% in the last 12 months, but in the last six months it has gained 12.4%. The shares added 10 cents to $28.89 by midafternoon Thursday.

On a busy day for Pfizer's board, directors also approved the repatriation of an additional $8.6 billion in earnings from foreign subsidiaries under a onetime tax holiday signed by President Bush last year. The law allows companies to bring back earnings from foreign subsidiaries for domestic use at a sharply reduced tax rate. Pfizer previously said it would repatriate $28.3 billion.

"Through our repatriation of foreign earnings this year, we are strengthening Pfizer's ability to pursue strategic opportunities while enhancing the company's flexibility to invest in our R&D pipeline and new product potential in the U.S.," McKinnell says.

The repatriation means that Pfizer estimates a tax charge of about $365 million, or 5 cents a share, in the second quarter. Pfizer also will record a reversal of at least $850 million of the $2.19 billion tax charge recorded in the first quarter in connection with the original $28.3 billion repatriation, "principally as a result of recent guidance issued by the U.S. Treasury," the company said.

Pfizer also announced that its board has amended the company's corporate governance principles to state that any director who receives a majority of withheld votes must submit his or her resignation to the board. The board will consider the resignation and make a recommendation.

"In recent years, the issue of majority voting for directors to the boards of public companies has emerged as a critical corporate governance issue that our board has addressed with today's decision," McKinnell says.