BlueLinx approves new $50 million share repurchase program

ATLANTA - BlueLinx Holdings Inc. (NYSE:BXC), a U.S. wholesale distributor of building products with a market capitalization of $608 million, announced Tuesday that its Board of Directors has approved a new $50 million share repurchase program. According to InvestingPro data, management has been actively pursuing share buybacks, with the stock currently trading below book value.

The new authorization will be funded through a combination of cash on hand and cash flow from operations, according to a company press release. With $11.5 million remaining under the previous $100 million repurchase program announced in October 2023, BlueLinx now has a total of $61.5 million available for share repurchases. The company maintains strong liquidity with a current ratio of 4.16, indicating ample resources to fund the buyback program while meeting operational needs.

The company stated that decisions regarding the timing and amount of share repurchases will depend on various factors, including capital needs, stock price, general market conditions, and other corporate considerations as determined by management.

The authorization does not obligate BlueLinx to acquire any specific amount of common stock and may be suspended or discontinued at any time.

BlueLinx operates across all 50 states as a distributor of residential and commercial building products, including lumber, panels, engineered wood, siding, millwork, and industrial products. The company serves various customers including national home centers, pro dealers, cooperatives, specialty distributors, and regional and local dealers.

In other recent news, BlueLinx Holdings has seen several significant developments. S&P Global Ratings revised the company’s outlook to negative from stable, citing reduced earnings and a slowdown in construction activities, which has negatively affected BlueLinx’s credit measures. DA Davidson downgraded BlueLinx’s stock rating from Buy to Neutral, attributing the change to "misguided takeout speculation" that has influenced the stock’s risk-reward profile. Additionally, BlueLinx announced a major shift in its executive compensation structure, linking future performance-based awards to the company’s total shareholder return compared to a peer group over a three-year period.

Mark Mason has been appointed as Vice President of Product Management, bringing extensive experience from his previous role at Stanley Black & Decker. The company also held its Annual Meeting of Stockholders, where eight directors were elected, Ernst & Young LLP was ratified as the independent auditor, and an advisory resolution on executive compensation was approved. These developments reflect BlueLinx’s ongoing adjustments and strategic decisions amidst a challenging economic environment.

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