IBM said its board has authorized a $15 billion share buyback program that could boost 2008 earnings by 5 cents a share, sending its stock up 3 percent.
The news also pushed the overall U.S. stock market higher. International Business Machines , which has a market capitalization of roughly $150 billion, was by far the top driver of the Dow industrials.
IBM said it now expects full-year earnings per share of at least $8.25, or 16 percent year-on-year growth. In January, the company had seen 2008 earnings per share at $8.20 to $8.30.
"IBM's profitable growth and consistently strong cash flow enable the company to continue to return value to our shareholders," Chief Executive Samuel Palmisano said in a statement.
The company said it expects to spend up to $12 billion on stock repurchases in 2008, and may buy shares in the open market or in private transactions. It said it expects to use cash from operations for the buybacks.
The new $15 billion share buyback authorization program adds to about $400 million remaining at the end of February from a prior authorization, IBM said. IBM said it does not anticipate
requesting board approval for additional funds for stock repurchases within the next 12 months.