ATI authorizes $700 million stock buyback program

PITTSBURGH - ATI Inc. (NYSE: ATI), a global producer of high-performance materials and solutions, has announced the authorization of a stock repurchase program by its Board of Directors. The company plans to buy back up to $700 million of its outstanding common stock, which is expected to support a multi-year initiative. The timing and volume of the repurchases will hinge on market conditions and corporate needs, and will comply with SEC Rule 10b-18's pricing and volume stipulations.

In tandem with the repurchase program, ATI has also declared its intention to redeem the remaining $291 million principal amount of its 3.5% Senior Convertible Notes due on September 10, 2024. Holders of the notes have the option to convert their investment into ATI common stock at a rate of 64.7178 shares per $1,000 principal amount until September 9, 2024. Those not opting for conversion will receive a cash redemption equal to the principal amount plus any accrued and unpaid interest.

Kim Fields, President and CEO of ATI, expressed confidence in the company's long-term financial performance and its strong cash and liquidity position. Fields highlighted that these financial maneuvers underscore ATI's commitment to a balanced capital allocation strategy that focuses on reducing debt, enhancing shareholder returns, and funding profitable growth.

The company's press release included forward-looking statements, which are based on current management expectations and are subject to various risks and uncertainties that could cause actual results to differ materially. These statements are not guarantees of future performance and may be affected by shifts in economic conditions, market demand, cost savings, raw material prices, pension plan asset values, labor relations, equipment outages, and other extraordinary events.

ATI specializes in serving the aerospace and defense sectors, as well as electronics, medical, and specialty energy markets. The company prides itself on solving complex challenges through materials science, partnering with customers to develop materials that enable high-performance applications.

This information is based on a press release statement from ATI.

In other recent news, Allegheny Technologies Incorporated (NYSE:ATI) has been the focus of positive developments. KeyBanc has increased the price target for ATI due to its growth prospects, following the company's strong second-quarter financial results for 2024. The firm cited ATI's connections to the commercial aerospace and defense sectors, new capacity and capabilities, and potential for free cash flow expansion as contributing factors.

ATI reported robust second-quarter results, with revenue reaching nearly $1.1 billion, the highest in a decade. The company's adjusted earnings per share (EPS) of $0.60 and adjusted EBITDA of $183 million exceeded expectations. Additionally, ATI announced new sales commitments of over $4 billion, mainly for high-value nickel products for jet engines, expected to add $100 million per year in incremental revenue.

Despite potential slowdowns in the oil and gas sector and the Chinese economy, ATI's leadership in aerospace and defense, along with strong demand for specialty products, is driving growth. With these recent developments, ATI continues to maintain a strong position in the market.

InvestingPro Insights

ATI Inc. (NYSE: ATI) has shown a strong commitment to enhancing shareholder value, as evidenced by its recent announcement of a significant stock repurchase program. This initiative is supported by the company’s robust financial standing, which includes a market capitalization of approximately $7.95 billion. ATI's strategy has been further validated by management's aggressive share buybacks, a clear indication of their confidence in the company's prospects.

InvestingPro data reveals that ATI is trading near its 52-week high, with a price 92.69% of the 52-week peak, reflecting a solid market performance. The company's Price to Earnings (P/E) ratio stands at 21.04, with an adjusted P/E ratio for the last twelve months as of Q2 2024 at 20.22. This suggests that investors are optimistic about the company's earnings potential. Moreover, ATI's Price to Book (P/B) ratio for the same period is 5.87, indicating a relatively high valuation compared to the company's book value.

With analysts predicting profitability for the current year and the company having been profitable over the last twelve months, ATI's financial health appears robust. InvestingPro Tips highlight that ATI's liquid assets exceed its short-term obligations, providing further assurance of the company's ability to meet its immediate financial commitments. It's also worth noting that ATI does not pay a dividend, which may appeal to investors who prioritize capital gains over income.

Additional insights are available on InvestingPro, where a total of 9 InvestingPro Tips for ATI can be found, offering a deeper analysis of the company's financial trends and stock performance (https://www.investing.com/pro/ATI).

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