Nokia Corp. (NYSE: NOK) has had several corporate governance announcements regarding its special dividend and buyback plan of late, and the shares were up by 2.6% at $8.25 for its ADSs trading in New York on Wednesday. Volume was also already 10% above normal with more than two hours until the market’s closing bell. Most importantly, this marked a 52-week high and a gain of more than 100% from the bottom. The question is whether this buyback really is good news.

Nokia had announced its 5 billion euro (almost $6.8 billion U.S.) capital structure optimization program, which we already assumed was to include acquisitions, dividends and buybacks. So since the company announced it has resolved to begin share repurchases, we see that the amount is up to a maximum of 370 million Nokia shares, or up to an equivalent of 1.25 billion euros (close to $1.7 billion U.S.).

The reality is that this sets only one-fourth of the company’s capital allocation for stock buybacks. In a separate announcement, Nokia said:

As previously announced, the Nokia Annual General Meeting held on June 17, 2014 has decided to distribute a special dividend in the amount of EUR 0.26 per share in addition to an ordinary dividend of EUR 0.11 per share for year 2013.

As far as the buyback goes, these shares can be repurchased directly in the market, or they can be transacted by entering into derivative, share lending or other arrangements. These shares repurchased can also reduce the number of the shares outstanding or can offset share-based incentive plans (option dilution).

Lastly, these share buybacks will start only after its second-quarter earnings results, which are due on July 24, 2014. The current authorization is valid until December 17, 2015.

In short, Nokia shares are up at a 52-week high in ADS terms, based on what now is the equivalent of a $30 billion market cap. Again, we cannot help but wonder if the excitement around its capital optimization plan may have run a bit far already.

Keep in mind that Nokia shares in New York have traded in a range of $3.70 to $8.28 over the past 52-weeks.

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