BFS Plans to Buy Back $1B in Common Stock

Builders FirstSource (BFS), the nation's largest pro dealer, reported that its board of directors has authorized the company to buy back up to $1 billion of its common shares.

The timing and amount of any share repurchases under the share repurchase program will be determined by Builders FirstSource’s management at its discretion based on ongoing assessments of the capital needs of the business, the market price of Builders FirstSource’s common stock and general market conditions, the company said.

“Since the merger of BFS and BMC at the onset of 2021, we have executed our integration plan, including the review of our balanced capital allocation strategy with the goal of maintaining our commitment to delivering long-term shareholder value,” said Dave Flitman, president and CEO of Builders FirstSource. “This new share repurchase program is aligned with that commitment and underpins our confidence in our balance sheet and strong cash flow generation.”

Flitman said that as of Aug. 11, BFS had approximately $417 million of cash on hand, which is consistent with the company’s recent guidance of $1.4 to $1.6 billion of free cash flow in 2021.

Share repurchases under the program may be made through a variety of methods, including open market purchases, in block trades, accelerated share repurchase transactions, trading plans in accordance with Rule 10b-5 or Rule 10b-18 under the Exchange Act, or any combination of such methods. 

Headquartered in Dallas, Texas, Builders FirstSource operates in 39 states with approximately 550 locations.

Last week, BFS reported big gains for the second quarter including:

• Net sales of $5.6 billion for the quarter increased 186.6% driven by the merger with BMC, commodity inflation, and strong organic growth.
• Gross profit of $1.6 billion increased 206.0% driven by the merger with BMC, commodity inflation, and double-digit organic growth.
• Net income for the company grew to $497.2 million, up from $122.5 million in the prior-year quarter.