U.S. Energy Corp. (NASDAQ: USEG) shares saw a modest increase of 0.47% in after-hours trading, reaching $2.3410, following the company's announcement of a significant share repurchase initiative. According to a Form 8-K filed on January 29, 2025, U.S. Energy has entered into a Share Repurchase Agreement with affiliates of Sage Road Capital, repurchasing 635,400 shares at $2.47775 per share, a premium of 8.2% over the closing price on January 27, 2025. This transaction was conducted separately from the company's ongoing $5 million share repurchase program, which has been extended to June 30, 2026, with approximately $3.8 million still available for future repurchases.
CEO Ryan Smith emphasized the strategic value of the repurchase, stating, "The continuation of our share repurchase program reflects our belief that this represents a highly attractive use of capital." The market's positive reaction reflects investor confidence in the company's capital allocation strategy and its potential to enhance shareholder value. The repurchase is expected to support the stock's market value and provide a tax-efficient method of returning capital to shareholders.
The company's decision to extend the repurchase program and engage in a separate affiliate transaction underscores its commitment to maintaining a disciplined capital allocation strategy while optimizing shareholder returns.
Sources: SEC Form 8-K, January 29, 2025; Press Release, January 29, 2025.