AMP (ASX:AMP) share price edges higher as buy-back commences

The AMP Ltd (ASX: AMP) share price is edging higher today after the company announced it would commence its $200 million share buy-back.
The post AMP (ASX:AMP) share price edges higher as buy-back commences appeared first on The Motley Fool Australia. –

asx share price inching higher represented by hand making gesture of small amount

The AMP Ltd (ASX: AMP) share price is inching higher this morning. The price movement comes after the financial institution advised it will be commencing the $200 million share buy-back it first announced in August last year.

At the time of writing, shares in the company are trading at $1.0775 – up 0.23%. By comparison, the S&P/ASX 200 Index (ASX: XJO) is 0.85% higher.

Let’s take a closer look at the buy-back.

AMP buys back shares

In a statement to the ASX this morning, AMP said it will commence its share buy-back program today.

AMP will buy the shares on the market. According to the statement, the plan is subject to market conditions and “other relevant factors”. The company also reserves the right to cancel the buy-back at any time.

The Australian Securities and Investment Commission (ASIC), says an on-market buy-back does not need any prior approvals from the regulator, as long as no more than 10% of equity is purchased with 12 months, known as the 10/12 rule. Given AMP has a market capitalisation of $3.7 billion, the $200 million buy-back is well under that 10% limit.

The financial giant is funding the purchase through cash on hand. Back in August, AMP had $1.4 billion in “surplus capital” and committed to returning $544 million back to its shareholders. $344 million was paid via a special dividend at the time. The company postponed the buy-back until it was able to conduct a portfolio review, which it completed in April this year.

Investors are responding mildly positively to the buy-back finally commencing, judging by today’s AMP share price moves.

AMP share price snapshot

The AMP share price recently sank to a new 52-week low after shareholders voted to approve a merger between its Diversified Property Fund (ADPF) and another fund run by DEXUS Property Group (ASX: DXS).

In more substantial news, the financial institution announced it would demerge its asset management business and thus, abandon its plans to sell AMP Capital to Ares. As well, the group recently saw its CEO resign and be replaced by the Deputy CEO of Australia and New Zealand Banking Group Ltd (ASX: ANZ).

Over the past 12 months, the AMP share price has sunk by around 25%. It’s fallen an even greater 31% since the beginning of this year. The company’s share price is now trading below what it was during the COVID induced market sell-off in March last year.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post AMP (ASX:AMP) share price edges higher as buy-back commences appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!