NEW YORK (TheStreet) -- Shares of the fast food restaurant chain Wendy's Co. (WEN) are higher by 2.88% to $11.42 at the start of trading on Wednesday morning, after the company announced a new $1.4 billion share repurchase program.
"Our recent operating results, along with the shareholder-value enhancing initiatives and updated outlook announced today demonstrate continued progress with our brand transformation," company CEO Emil Brolick said in a statement announcing the repurchase.
"The growth reflected in our long-term outlook, especially our expectations for steadily increasing Adjusted EBITDA margins, demonstrates the higher quality of earnings we are generating as a result of our system optimization initiative, which remains on track for completion in 2016," Brolick continued.
As part of the plan the company will begin an $850 million share repurchase program today, with a tender offer to purchase up to $639 million of its common stock at a price between $11.05 and $12.25 per share.
The buyback will include a piece of the stake owned by Wendy's biggest shareholder Trian Fund Management, which is owned by billionaire Nelson Peltz.
Train owns approximately 24.8% of Wendy's outstanding common stock and is intending over the next few months to lower its ownership position by between 17% and 19.68% through the sale to the company.
Wendy's is the third largest burger chain in the U.S., according to Bloomberg.
Separately, TheStreet Ratings team rates WENDY'S CO as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation: