FedEx (NYSE:FDX) shares are trading higher Tuesday after the company announced a new $1 billion accelerated share repurchase (ASR) agreement.
Under the agreement with Mizuho Markets Americas LLC, FedEx will initially receive approximately 3.2 million shares for $1 billion on December 28, 2023. The remaining shares, if any, will be delivered by February 29, 2024. The total number of shares bought will be based on an average of the volume-weighted average stock price during the term minus a discount.
This ASR is part of FedEx's previously announced share repurchase program.
Investors reacted positively to the news, with FedEx shares up 1.75% at the time of writing. The ASR highlights the company's focus on enhancing shareholder value and returning excess cash to investors.