IBM ( IBM) added $4 billion to its buyback authorization Monday, an action that if consummated would cut its outstanding share count by almost 48 million at current prices.

The company has about 1.58 billion shares outstanding and a market capitalization of about $131.6 billion. A fully exercised buyback would reduce the share count by 3%.

The additional funds will be used to buy back shares on the open market or in private transactions from time to time, depending on market conditions, IBM said.

The stock rose 25 cents to $83.72 on the news. At that price, it's trading for 16.3 times this year's Thomson First Call consensus earnings estimate of $5.15 a share and 14.8 times next year's estimate of $5.63. The price implies an earnings yield of 6.7% based on the 2006 consensus.