Ameriprise Financial (NYSE:AMP) to Buyback $5.50 billion in Stock

Key Points

• Ameriprise Financial authorized a $5.50 billion stock buyback, allowing the company to repurchase up to 12.3% of its outstanding shares through open-market purchases.
• The company reported strong quarterly results, with EPS of $11.07 beating estimates and revenue rising 11.6% year over year to $4.90 billion. It also maintains a quarterly dividend of $1.70 per share, yielding about 1.4% annually.
• Analysts have a consensus “Hold” rating and an average price target of $555.33, while the stock recently traded at $492.70. Insiders sold nearly 30,000 shares worth approximately $16.3 million over the past 90 days.

Ameriprise Financial (NYSE:AMP - Get Free Report) announced that its Board of Directors has authorized a stock buyback plan on Tuesday, September 29th, RTT News reports. The company plans to buyback $5.50 billion in shares. This buyback authorization permits the financial services provider to buy up to 12.3% of its shares through open market purchases. Shares buyback plans are generally a sign that the company's leadership believes its stock is undervalued.

Ameriprise Financial Trading Down 0.9%

NYSE AMP traded down $4.62 during trading on Wednesday, hitting $492.70. The company had a trading volume of 769,333 shares, compared to its average volume of 639,397. The company's fifty day moving average is $545.45 and its 200-day moving average is $493.05. Ameriprise Financial has a one year low of $422.37 and a one year high of $572.56. The company has a current ratio of 0.71, a quick ratio of 0.71 and a debt-to-equity ratio of 0.99. The company has a market cap of $44.29 billion, a price-to-earnings ratio of 11.88, a price-to-earnings-growth ratio of 0.89 and a beta of 1.14.

Ameriprise Financial (NYSE:AMP - Get Free Report) last announced its earnings results on Thursday, July 23rd. The financial services provider reported $11.07 earnings per share for the quarter, beating analysts' consensus estimates of $10.81 by $0.26. Ameriprise Financial had a net margin of 20.24% and a return on equity of 64.19%. The firm had revenue of $4.90 billion for the quarter, compared to analyst estimates of $4.87 billion. During the same quarter in the previous year, the firm posted $9.11 EPS. The company's revenue for the quarter was up 11.6% compared to the same quarter last year. On average, sell-side analysts predict that Ameriprise Financial will post 46.27 earnings per share for the current year.

Ameriprise Financial Announces Dividend

The company also recently announced a quarterly dividend, which was paid on Friday, August 21st. Shareholders of record on Monday, August 3rd were issued a dividend of $1.70 per share. The ex-dividend date was Monday, August 3rd. This represents a $6.80 dividend on an annualized basis and a dividend yield of 1.4%. Ameriprise Financial's dividend payout ratio is 16.40%.

Wall Street Analysts Forecast Growth

A number of equities research analysts have issued reports on the stock. Keefe, Bruyette & Woods raised their price target on shares of Ameriprise Financial from $515.00 to $545.00 and gave the stock a "market perform" rating in a report on Friday, July 24th. Morgan Stanley raised their target price on Ameriprise Financial from $467.00 to $489.00 and gave the stock an "underweight" rating in a research note on Friday, July 10th. Weiss Ratings upgraded Ameriprise Financial from a "buy (b-)" rating to a "buy (b)" rating in a report on Thursday, September 3rd. Zacks Research lowered Ameriprise Financial from a "strong-buy" rating to a "hold" rating in a research report on Monday, September 21st. Finally, Piper Sandler increased their price objective on Ameriprise Financial from $471.00 to $518.00 and gave the stock a "neutral" rating in a report on Monday, July 13th. One investment analyst has rated the stock with a Strong Buy rating, four have assigned a Buy rating, five have assigned a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat, the company currently has a consensus rating of "Hold" and an average target price of $555.33.

Insider Transactions at Ameriprise Financial

In other news, SVP Dawn Brockman sold 472 shares of the firm's stock in a transaction that occurred on Monday, August 10th. The stock was sold at an average price of $558.93, for a total value of $263,814.96. Following the completion of the transaction, the senior vice president owned 713 shares in the company, valued at $398,517.09. This trade represents a 39.83% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available through this hyperlink. Also, CFO Walter Berman sold 11,012 shares of Ameriprise Financial stock in a transaction that occurred on Tuesday, July 28th. The shares were sold at an average price of $548.95, for a total value of $6,045,037.40. Following the sale, the chief financial officer owned 5,609 shares in the company, valued at $3,079,060.55. This represents a 66.25% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 29,988 shares of company stock worth $16,316,497 over the last 90 days. 0.60% of the stock is currently owned by insiders.

About Ameriprise Financial

Ameriprise Financial, Inc is a diversified financial services company headquartered in Minneapolis, Minnesota. The company provides financial planning, investment advice, wealth management, retirement planning and insurance solutions to individuals, families, business owners and institutional clients.

Ameriprise serves clients primarily through a network of financial advisors and offers products and services that include brokerage and advisory accounts, mutual funds and other investments, retirement accounts, annuities, life and long-term-care insurance, banking products and personalized financial planning.

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