Software giant Blackbaud’s board of directors has approved the buyback of up to $500 million of company stock, doubling their previously approved $250 million repurchase plan announced late last year.
The repurchase program allows the company to buy back its common stock on the open market or through private transactions. Following the initially approved repurchase plan, the company reacquired just less than $41.1 million of its shares in December and another $600,000 following the latest buyback authorization last Wednesday.
Approximately $499.4 million in funds — about 11% of Blackbaud’s total market capitalization of $4.5 billion — remained available for purchase under the stock buyback program as of late last week.
“The expanded authorization of our stock repurchase program is reflective of our strong cash flow generation, our confidence in the business, and our continued commitment to enhancing shareholder value,” said Blackbaud CFO Tony Boor.
The enhanced buyback program comes on the heels of a 12-month period in which Blackbaud’s stock has gained more than 30% from its value of a year ago. The stock was trading at $83.57 as of midday Tuesday.
The announcement also follows a strong third quarter in which Blackbaud saw organic revenue grow 8.3% on total revenue of $278 million. Managers at the time reiterated their previous financial guidance for the remainder of the fiscal year, which they expect will result in total non-GAAP 2023 revenue of $1.095 billion to $1.125 billion and non-GAAP earnings per share of $3.63 to $3.94.
The growth is being driven by a combination of cost-cutting and new product offerings backed by contractual and transactional recurring revenue streams that include multi-year subscriptions. New product plans include streamlined donation software designed to enable higher conversion rates with fewer clicks and another new product called Impact Edge, which will integrate features of Blackbaud’s EVERFI education management software with its YourCause volunteer and giving data platform. The company expects Impact Edge to debut later this year.
“As we continue to execute against our capital deployment strategy, we’re focused on growing the business through balance sheet management, rigorous oversight of investments in the business, and efficiently returning excess capital to shareholders,” Boor said.
Blackbaud’s next earnings call is expected in early February.
Editor’s Note: The name of the product Impact Edge was fixed from an earlier version.
