Health Management Associates, Naples, Fla., said its board authorized a buyback of as many as 10 million shares, an initiative that could cost up to $240 million based on the company's current stock price.
The company said its strong cash flow will allow it to buy back shares and still pay its regular dividend of 4 cents per share without hampering its acquisition program. HMA set a goal of acquiring four to six hospitals in its current fiscal year, which ends Sept. 30. The company has acquired four hospitals so far.
In a news release announcing the buyback, company President and Chief Executive Officer Joseph Vumbacco said HMA also has a letter of intent to acquire a not-for-profit hospital, but details were not provided. HMA has approximately 246.5 million shares outstanding, trading at about $24 per share.
The company operates 57 hospitals in 16 states.