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September 13, 2006

Sears Ups Share Buyback

Sears Holding (SHLD) announced that it is increasing its share repurchase authorization by $500 million. About $118 million remains on the prior $1.5 billion authorization. So far, the company has repurchased 11 million shares at an average price of $126.14. As of August 29, the company had 154 million shares outstanding. At current prices, the new authorization plus the remaining $118 million can buy almost 4 million additional shares.

SHLD sold off following the most recent quarterly earnings, partly because I and many others noted that share repurchases seemed to have slowed and that the press release contained language that could be interpreted as a signal they would remain slow. Apparently, we were all wrong.

I suspect the investors will like this news, and that the recent positive momentum in the shares will continue.

Posted by Steve Birenberg at September 13, 2006 12:55 PM in SHLD