LOUISVILLE, Ky. -- Stock buybacks have become popular financial strategies for foodservice companies in recent weeks.
On Nov. 20, the board of directors at Yum! Brands, owner of Pizza Hut, authorized the repurchase of up to $300 million of its common shares over the next two years. According to a company release, Yum began its stock buy-back program in 1999, and has spent about $650 million on the effort.
Papa John's International, also based in Louisville, recently extended its own share repurchasing program into 2003, and raised its spending ceiling to $375 million.
The stocks of both industry giants have suffered this year. Since trading as high as $33.17 in June, Yum's shares have fallen $10 in the wake of flat to negative comp-store sales at Pizza Hut and KFC.
Papa John's stock rallied spectacularly from a year-to-date low of $23.37 in February, to a high of $35.19 in June. However, negative comp-store sales since have pushed share prices down to around $27.