Primis Financial’s board reopens buyback toolbox — a modest move with meaningful implications for shareholders

Board reauthorizes share buybacks; company signals cash buyback without a fresh dividend pledge

Primis Financial Corp. announced that its board has reauthorized a program to repurchase the company’s common stock. The step restores an explicit buyback mandate and lets the company buy shares on the open market or through negotiated transactions, subject to market conditions and regulatory limits. The board framed the move as part of ongoing capital-management options rather than a firm commitment to a set dollar amount or fixed timetable.

Management said the program gives the company flexibility to return cash to shareholders when it makes sense, while preserving capacity for lending, M&A and operational needs. The announcement did not lock in a repurchase schedule or promise a specific pace; instead, the company will decide buys based on liquidity, price, and overall capital requirements.

How buybacks change the math: what investors should expect to see

A buyback reduces shares outstanding and therefore changes key per-share measures. The simplest effect is mechanical: shrinking the share count increases earnings per share (EPS) and can raise tangible book value per share, assuming the company pays less than or equal to book per share for the stock.

Because the firm did not specify a size, assess impact using percentages. If the company repurchases 1% of its shares, EPS rises by about 1% (all else equal). A 5% repurchase lifts EPS by roughly 5.3% because EPS scales inversely with shares outstanding. Larger programs produce bigger lifts, but also use more cash.

Buybacks also affect tangible book value per share depending on the price paid. If the company buys shares at a price below book value per share, tangible book per share rises; if it pays a premium, tangible book falls. Finally, the buyback’s scale matters relative to market value and average daily trading volume. A modest program — a low-single-digit percent of shares outstanding — typically has limited market disruption. A larger program can absorb meaningful liquidity and move the stock.

Why the board moved now: capital allocation and strategic priorities

Boards usually reauthorize repurchases for three reasons: they believe the shares are undervalued, they have excess cash beyond near-term business needs, or they want to provide a flexible way to return capital without a recurring dividend. In this case, the company presented the program as a discretionary tool rather than a guaranteed cash return.

That suggests management is prioritizing optional returns while keeping room for lending growth, potential acquisition opportunities, and steady operations. The reauthorization signals confidence in the franchise but also a desire to keep capital allocation flexible amid shifting loan demand and interest-rate dynamics that affect regional lenders.

How investors and the market are likely to read it

Buyback news is usually received positively when shares look cheap and the firm has a sound balance sheet. For active investors, the key questions will be: how large is the authorization, how quickly will buys occur, and at what prices. Without a heavy dollar figure or a set timeline, the market may take the announcement as modestly supportive rather than transformative.

Relative to peers, the move places Primis among banks and finance firms that use repurchases to smooth returns when loan growth slows. Reception will depend on recent performance and valuation: if the stock has lagged peers and trades at a discount to book, the program could be seen as value-accretive. If the shares are already richly valued, any buybacks might look less efficient.

Execution details investors should monitor and the risks involved

Watch for disclosure on execution method and cadence. Open-market repurchases spread purchases over time, while negotiated buys or accelerated programs can move the market and signal urgency. Companies sometimes announce a 10b5-1 plan (pre-set buy rules) to avoid appearance of opportunistic timing; check future filings for that detail.

Key risks: buybacks consume cash that could otherwise fund lending, reserves, or an acquisition. If the company pays too much per share, buybacks can destroy book value. There’s also timing risk — aggressive repurchases before an earnings or credit deterioration cycle can magnify losses. Investors should track follow-up filings and quarterly disclosures for the size, pace and accounting impact of purchases.

In short, the reauthorization is a pragmatic move that gives Primis flexibility. It can be a tidy tool to lift per-share metrics if executed prudently, but the real value will depend on size, timing and whether buybacks compete with other uses of capital.

Sources

• prnewswire.com