Why Kyndryl Holdings Stock Is Soaring Today
Kyndryl (NYSE: KD) stock is surging in Thursday's trading. The IT company's share price was up 14.6% as of 3:15 p.m. ET. Meanwhile, the S 500 index was up 0.7%.
Kyndryl stock is making big gains on the heels of the investor conference the company hosted yesterday. At the conference, management outlined a major stock buyback plan and gave encouraging forward guidance for the business.
Kyndryl announced that its board of directors has authorized up to $300 million in stock buybacks. By buying back and retiring stock, Kyndryl will reduce its total number of shares outstanding. The repurchasing plan suggests that future earnings will be distributed across a smaller number of shares, which means that per-share earnings would rise on a comparative basis even if net profits remained the same. The buyback plan is a good indication that Kyndryl believes its stock is currently undervalued and that management is comfortable with the company's financial positioning.
Source Fool.com
