Information Madness

AOL has publicized that its board of directors has given the green light for a stock repurchase program that will let the company to buy back up to $250 million of its outstanding shares of common stock from time to time over the next 12 months. If you are not aware, AOL has been the owner of TechCrunch for almost a year now.

The shift comes after AOL’s stock took a enormous fall following the reporting of its second-quarter results.

AOL reported revenues of $542.2 million for the quarter, down 8 percent contrast to Q2 2010, and a net loss of id="mce_marker"1.8 million. The results hit analyst potential, but shareholders were discontented and sent shares to their lowest level since AOL detached from Time Warner in December 2009.
AOL also lowered its outlook for the year, which was not of much help.

A stock repurchase program allows companies buy back its own shares from the marketplace, thus sinking the number of outstanding shares, and is typically approved when a company’s management considers the shares are hold in low esteem or less priced. The drop of the drift means that even a company’s base line remains the same; its earnings per split amplify.

At present, the stock is trading at $10.22, down from $15.07 two days ago.

“This announcement highlights both our strong balance sheet and free cash flow generation. We believe this is a unique opportunity to invest in our company.” Comments Artie Minson, CFO of AOL.