Sharplink Launches $1.5B Share Buyback to Boost Stock Below NAV

TLDR

• Sharplink has launched a $1.5 billion share buyback program to enhance stockholder value.
• The company’s stock is currently trading below its net asset value (NAV), prompting the buyback decision.
• Sharplink repurchased 939,000 shares at an average price of $15.98 each.
• The buyback program aims to increase NAV per share and boost the company’s stock price.
• Sharplink holds $3.59 billion in Ether, with nearly all of it staked to generate revenue.

Sharplink, the second-largest Ether treasury company, has announced a $1.5 billion share buyback program. This decision comes as the company’s stock is trading below its net asset value (NAV). Sharplink aims to boost stockholder value by repurchasing its shares, which are currently undervalued.

Share Repurchases to Boost Stockholder Value

On Tuesday, Sharplink stated that stock repurchases would immediately benefit stockholders. The company believes the market undervalues its shares. Co-CEO Joseph Chalom emphasized that the company is focused on disciplined capital allocation, including buybacks.

SharpLink’s decision to start a buyback program aligns with advice from market analysts. Recently, NYDIG analysts suggested that crypto treasury companies should consider buybacks when their shares fall below NAV. Sharplink’s program aims to boost its stock price and enhance its NAV per share. The buybacks represent a strong move to attract investors amid a challenging market.

Sharplink Begins Repurchasing Shares at $15.98 Each

Sharplink initiated its buyback program by purchasing 939,000 common shares. The repurchase price was an average of $15.98 per share. Shares of Sharplink closed at $16.69 on Wednesday, a 6.59% increase from the previous day. Despite this rise, the stock has fallen by 25.29% over the last 30 days.

The company believes its shares are significantly undervalued at current prices. Sharplink’s buyback program reflects its confidence in the long-term strategy.

Sharplink currently holds 837,230 Ether, valued at approximately $3.59 billion. Nearly all of its Ether holdings are staked to earn blockchain rewards. These rewards contribute material revenue to Sharplink, which further supports the buyback initiative.

The company authorized the buyback program on August 22. Chalom stated that the program allows Sharplink to act swiftly when market conditions are right. The firm’s substantial Ether holdings and strategic decision to repurchase shares reflect a strong commitment to growing its stockholder value.

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