In line with an announcement last month, General Dynamics [GD] on Thursday boosted its stock repurchase program.
GD said that its board has authorized the repurchase of up to 20 million shares of its common stock. That announcement follows the accelerated repurchase of 11.4 million shares of stock for $1.1 billion, which exhausted the previous authorization for share repurchases.
During the company’s fourth quarter earnings call, GD Chairman and CEO Phebe Novakovic said management planned to accelerate the completion of share repurchases under its existing buyback program and seek authority for additional repurchases. Those actions were done in part due to the lack of share repurchases in the fourth quarter of 2013.
Companies typically use their free cash to buy back their own stock in order to help prop up the share price as a way to reward shareholders.