Illinois Tool Works Inc. (NYSE: ITW) announced a new share repurchase program to buy back up to $3 billion of the company’s common stock over an open-ended period of time. The full authorization represents approximately 55 million shares based on the company’s closing share price on August 20, 2007.
The company’s existing share repurchase authorization, announced in August of 2006, consisted of 35 million shares. There are approximately 12 million shares remaining under this authorization. Thus far in 2007, the company has spent a total of $680 million to repurchase shares.
The company also said it expects to repurchase $1.1 billion to $1.4 billion in 2007, up from the prior range of $700 million to $900 million.
ITW is a $14.1 billion in revenues diversified manufacturer of highly engineered components and industrial systems and consumables.
PAYOUT YIELD ANALYSIS
With 552 million shares outstanding, the $1.1 to $1.4 billion repurchase in 2007 will return $1.99 to $2.54 per share. Combined with the current annualized dividend of $1.12, the projected 12 month Total Payout is $3.11 to $3.66. At a share price of $55, the Total Payout Yield is projected to be 5.7% to 6.7%.
- Payout Yield Staff