Grilla Grills parent company American Outdoor Brands (AOB) announced a $10 million share repurchase program today. Much like the investment firm HIA that recently took a 7.5% stake in the company, AOB is indicating with the repurchase that their stock is undervalued.
This announcement underscores our Board’s confidence in our business and its dedication to stockholder value creation. Our strong balance sheet and anticipated positive cash flow enable us to prioritize investing for growth, both organically and through opportunistic and accretive M&A activity, while maintaining our commitment to returning capital to our stockholders. As we evaluate our capital allocation priorities, we believe it is appropriate and important to have the authority to repurchase stock at our discretion.President and Chief Executive Officer, Brian Murphy
The approval from the board is to repurchase up to $10 million of AOB’s outstanding common stock through September 2023 on the open market, in block trades or in privately negotiated transactions.
While the repurchase program doesn’t obligate AOB to acquire shares, it’s an interesting signal while other companies in the space have made moves to preserve cash. For example, due to lower than expected sales and cash being tied up in inventory, Weber cancelled their dividend earlier this year.