JDS Uniphase Votes For Buyback Over Expansion (JDSU)

JDS Uniphase Inc. (NASDAQ: JDSU) has just announced that its board of directors has authorized the repurchase of up to $200 million in shares of common stock.  The repurchases can be via open market or private transactions, and it set this as a two year period ending May 14, 2010.

JDS Uniphase’s market cap is roughly $2.6 Billion.  Based upon today’s prices, this would net out approximately 17 million shares.  That in turn is representative of nearly 2.5 days worth of average trading volume.

As far as how this relates to total cash, as of March 29, 2008, JDSU had $1.045 Billion in cash and short-term investments, and still had $26.7 million listed as long-term investments.  Its total liabilities were also $1.13 Billion. 

Unfortunately, this buyback doesn’t sound like it is going to be large enough to make any massive dent even though shares should run up initially on this news.  It also signals that there might not be that many great niche and complimentary or adjacent mergers it wants to make.

Shares closed at $11.51 yesterday and are up almost 1% pre-market at $11.61; its 52-week trading range is $9.49 to $16.05.

Jon C. Ogg
May 15, 2008

Jon Ogg produces and edits the "10 Stocks Under $10" newsletter and he does not own securities in the companies he covers.