Clarivate Reveals $1B Share Buyback Plan; Shares Pop 9.5%

Clarivate Plc (NYSE: CLVT) disclosed that its board of directors has approved a common stock repurchase plan of up to $1 billion through open-market purchases. The plan comes with an expiration date of December 31, 2023.

The company provides scientific and research, patent intelligence and compliance standards, pharmaceutical and biotech intelligence solutions, and trademark, domain and brand protection. Shares of CLVT gained 9.5% on Monday.

Clarivate plans to fund the purchases with cash in hand and will seek shareholder approval at its annual meeting to increase its current shareholder authorization received in 2020, which authorized the repurchase of 50,000,000 ordinary shares.

The Executive Chairman and CEO of Clarivate, Jerre Stead, said, “Our Board is committed to a disciplined capital allocation strategy including investing to support growth initiatives and returning capital to shareholders. We are generating strong cash flow and believe our current share price represents a compelling investment opportunity.”

Stock Rating

Recently, RBC Capital analyst Ashish Sabadra reiterated a Buy rating on Clarivate and lowered the price target to $23 from $29. The new price target implies 42% upside potential from current levels.

Consensus among analysts is a Moderate Buy based on 5 Buys and 2 Holds. The average Clarivate price target stands at $22.83 and implies upside potential of 40.9% to current levels.

Hedge Fund Trading Activity

TipRanks’ Hedge Fund Trading Activity tool shows that confidence in Clarivate is currently Very Positive, as the cumulative change in holdings across all nine hedge funds that were active in the last quarter was an increase of 22.3 million shares.

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