- Galaxy Digital shares surged 18% to $19.90 after the company announced a $200 million share repurchase program.
- The move signals management’s view that the stock is undervalued and that the firm has excess capital to deploy.
- The announcement boosted investor sentiment despite the company reporting a quarterly net loss of $482 million earlier in the week.
- Major cryptocurrencies like Bitcoin and Ethereum also posted gains, while the Dow Jones Industrial Average broke 50,000 for the first time.
Shares of Galaxy Digital (GLXY) surged 18% on Friday after the crypto financial services firm announced a significant stock buyback program. The board approved a $200 million share repurchase initiative, authorizing the company to buy back its Class A common stock over the next 12 months.
This strategic move indicates confidence from management that the company’s shares are currently undervalued. CEO Mike Novogratz confirmed this perspective, stating, “That foundation gives us the flexibility to return capital to shareholders when we believe our stock doesn’t reflect the value of the business.”
However, the announcement followed a recent earnings report that initially weighed on the stock. Galaxy Digital posted a fourth-quarter net loss of $482 million, data shows the initial market reaction was negative.
Consequently, the buyback program served to reassure the market about the firm’s underlying strength and liquidity. The company ended the year with $2.6 billion in cash and stablecoins, underscoring its robust financial position.
Meanwhile, broader crypto markets also experienced positive momentum on the day. According to market data, Bitcoin climbed back toward $70,000 while Ethereum broke above $2,000.
Other related equities participated in the rally, with Coinbase (COIN) shares climbing over 10%. This positive sentiment extended to traditional markets, where the Dow Jones Industrial Average broke 50,000 for the first time.
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