By: E&P Staff Lee Enterprises plans to spend as much as $30 million buying back its sagging stock, the Davenport, Iowa-based community newspaper publisher announced Monday.
"The true value of Lee stock is currently greatly undervalued on Wall Street, and we see this buyback as an opportunity to add value for our stockholders as it is immediately accretive to earnings per share," Lee Chairman and CEO Mary Junck said in a prepared statement.
Junck said the chain's "continuing strong cash flow" will allow Lee to make the buyback without significantly affecting its debt repayment schedules or other possible uses of free cash after dividends.
She noted Lee reduced its net debt by $135 million in its 2007 fiscal year and by $179 million in 2006. Last Thursday, Lee stock fell more than 18% in a single day on unusually large trading volume. The company said it did not know any reason for the stock movement.
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