WASHINGTON, Dec. 17 (Xinhua) -- After a severe loss in its market value, Johnson & Johnson (J&J), a major player in world pharmaceutical market, announced on Monday that it planned to repurchase up to 5 billion U.S. dollars of its common stock.
A repurchase of common stock stands for the practice that a company would acquire its own stock either to retire the repurchased shares or to keep it as treasury stock for future re-issuance. Meanwhile, such practice could pull up the company's stock price.
J&J's stock tumbled 10 percent on Friday, wiping out about 40 billion dollars of its market value due to a report from Reuters, which said the company knew for decades that asbestos was in its famous baby powder.
The sharp drop marked J&J's worst trading day since 2002.
In Monday's announcement, the New Jersey-based company reaffirmed its full-year 2018 sales guidance of 81 to 81.4 billion dollars, and adjusted earnings per share guidance of 8.13 to 8.18 dollars per share.
"Repurchases may be made at management's discretion from time to time on the open market or through privately negotiated transactions. The repurchase program has no time limit and may be suspended for periods or discontinued at any time," said the company.
The company also said that it does not expect to incur debt to fund the share repurchase program.
Founded in 1886, J&J was a major player in the world pharmaceutical and medical device building industry. The company ranked 37th on the 2018 Fortune 500 list of the largest corporations in the United States.
