HP Buys Back $1.3 Billion of Shares

Hewlett-Packard Co. said Monday that it had bought back $1.3 billion in stock and announced a plan to buy back an additional $3 billion in shares during the next several months.

Shares of the computer and printer giant edged up 30 cents to $18.41 on the New York Stock Exchange.

During the fiscal fourth quarter ending Oct. 31, the Palo Alto-based company will buy back about $2.1 billion in stock, or 4% of its shares outstanding, it said.

That purchase is part of a $2-billion buyback plan announced in May plus a portion of the newly approved $3 billion in buybacks, Hewlett-Packard said.

Companies use buybacks to increase earnings per share by reducing shares outstanding. Hewlett-Packard has 3.01 billion shares outstanding.

Hewlett-Packard repurchased the $1.3 billion in stock from investment bank Merrill Lynch, it said. Under the accelerated share repurchase agreement, Hewlett-Packard was permitted to buy the shares immediately from Merrill. Merrill will buy the shares in the open market over the next several months.