What was the amount of Budget's repurchases of common stock in 2024?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
dividend of $10.00 per share to all holders of our common stock as of December 15, 2023, totaling $355 million. Our ability to pay dividends to holders of our common stock is limited by our senior credit facility, the indentures governing our senior notes and our vehicle financing programs.
Share Repurchases
Our Board of Directors has authorized the repurchase of up to approximately $8.1 billion of our common stock under a plan originally approved in 2013 and subsequently expanded most recently in February 2023 (the "Stock Repurchase Program"). During 2024, 2023 and 2022, we repurchased 21.6 million shares of common stock under the S
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, during 2024, Budget repurchased 21.6 million shares of its common stock under the Stock Repurchase Program. The total cost for these repurchases was approximately $4.2 billion, excluding excise taxes due for 2024 and 2023 repurchases under the Inflation Reduction Act of 2022. As of December 31, 2024, approximately $757 million remained available for future repurchases under the Stock Repurchase Program.
This indicates that Budget is actively buying back its own shares, which can be a way to return value to shareholders. Share repurchases can reduce the number of outstanding shares, potentially increasing earnings per share and making the remaining shares more valuable. The fact that Budget spent a significant amount on repurchases suggests a belief that its stock is undervalued.
For a prospective franchisee, this information provides insight into Budget's financial strategy and its approach to managing shareholder value. While stock repurchases don't directly impact franchise operations, they reflect the overall financial health and priorities of the parent company. A company that is financially stable and focused on increasing shareholder value may be more likely to invest in the franchise system and support its franchisees.
However, it's important to note that the Stock Repurchase Program is subject to the discretion of Budget's Board of Directors. The Board could decide to modify, suspend, or terminate the program at any time, depending on market conditions and other factors. Therefore, future repurchases are not guaranteed, and the amount could vary significantly from year to year.