Online auction firm eBay is following its 24% jump in fourth-quarter profit with an ambitious stock buyback that Wall Street interpreted as a measure of executives' bullishness for future growth, an Associated Press report said.
The report said eBay shares increased $1.38, or nearly 5 %, to close at $30 on the Nasdaq Stock Market before the earnings report was released.
The shares jumped to $33.98, up an additional 13.2%, in after-hours trading.
The Associated Press report said the US -based e-commerce powerhouse announced it would repurchase up to $2 billion of common stock within the next two years. Stock buybacks are considered a quick way to pump up a flagging stock price, if companies have plenty of cash and are confident about future earnings growth.
This is the second major repurchase program at eBay in the past year. The company repurchased 31 million shares for about $1 billion last quarter, the report said.
The solid earnings report and buyback come almost exactly two years after eBay stock slipped precipitously on concerns about whether the company could withstand competition from other e-commerce leaders, particularly Google.
Analysts said the stock may now be a value relative to many of its rivals.