Eastman Kodak Shrinking Itself After IRS Refund (EK)

Eastman Kodak Co. (NYSE: EK) has a few developments this morning that are acting to help the stock.  For starters the company has announced a $1 Billion share repurchase program, which is close to 25% of its outstanding shares now that its market cap has tanked down to $4 Billion from More than $8 Billion a year ago. 

Part of this will be funded by an IRS refund settlement that entitles Kodak to get back some $581 million as part of the settlement.  The company noted that the boost will add about $574 million to its Q2 results, with $300 million from discontinued operations and $274 million from continued operations.

Shares are up about 13% at $14.04 in early trading.  But before traders get too excited here they should recall that the 52-week trading range was $12.20 to $29.60 and that the stock has been hitting the 52-week low list with regularity.

The company listed cash and equivalent assets as $2.203 Billion as of March 31.  Its total assets were carried as $12.864 Billion, although we’d note that $1.691 Billion was goodwill and some $4.069 were listed as "other."  Kodak’s liabilities at the same date were $3.668 Billion in current liabilities and total liabilities were listed as $9.764 Billion.

Jon C. Ogg
June 24, 2008