Allergan (AGN) rose in premarket trading on Wednesday as the announcement of another mammoth share buyback and a quarterly dividend helped take the sting out of a quarterly earnings miss for investors.
Allergan reported total net revenue of $3.62 billion, up 4.4% on the same period one year ago, against expectations for a top-line number of $3.67 billion. Adjusted operating income was $1.78 billion. Non-GAAP adjusted earnings per share were $3.32 against expectations for $3.56.
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But the company also said that it will buy back another $10 billion of its own stock, after having completed an earlier $5 billion repurchase, which brings the total of recent buybacks to $15 billion.
In addition to an increased buyback, Allergan will begin paying quarterly dividends from March 2017, with all stockholders who are on the register by Feb. 28 being eligible for the first payment of 70 cents.
"We continue to believe there is no greater investment than Allergan stock, given our powerful growth prospects. This decision underscores our commitment to continuously enhancing value creation for our shareholders," said CEO Brent Saunders.
The stock rose more than 1% in premarket trading to change hands at $211. It is down by around 25% so far in 2016.