Solstice Advanced Materials (NASDAQ:SOLS) jumped by 12.76 percent on Friday to finish at $63.53 apiece after abandoning a plan to acquire Element Solutions for $14.5 billion, while investors also cheered a $500 million share buyback program.
In a statement, the company said that it entered into an agreement with Element Solutions to formally terminate their planned merger following conversations with shareholders and discussions between parties.
“Both Boards unanimously believe that it is in the best interests of our respective shareholders, employees and customers to terminate the merger agreement,” Solstice Advanced Materials (NASDAQ:SOLS) said, adding that it believes its ongoing strategic plan and leadership team will deliver substantial value for its shareholders.
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$500M Buyback
Apart from the abandoned transaction, the listed firm also announced plans to embark on a share repurchase program amounting to $500 million in a bid to boost shareholder value.
The buyback can be implemented through a series of methods, including open market purchases, accelerated repurchase negotiations, and negotiated block transactions.
The company expects to utilize cash on hand to fund the transaction.
“Our first share repurchase program underscores the Board and management team’s confidence in Solstice’s long-term strategy, growth prospects and ability to create value for shareholders, as well as our commitment to disciplined capital allocation and returning capital to shareholders,” President and CEO David Sewell said.
September Dividends
Also on September 10, shareholders on record as of August 27, 2026 are set to receive $0.075 in dividends per share held.
The distribution followed the company’s solid earnings performance in the second quarter of the year, during which attributable net income increased by 23 percent to $119 million from $97 million in the same period last year, primarily driven by higher net sales and lower income taxes, partially offset by higher standalone company operating costs and net interest expense.
Net sales also grew by 11 percent to $1.148 billion from $1.033 billion year-on-year, thanks to 12-percent higher sales from the refrigerants and applied solutions segment, and an 8-percent jump in sales from the electronic and specialty materials segment.
Analysts, Hedge Fund Sentiment
Institutional sentiment appeared to have weakened for Solstice Advanced Materials (NASDAQ:SOLS) in the second quarter of the year, as evidenced by the drop in companies holding positions as well as their committed investments.
Data from Insider Monkey showed that during the period, 72 hedge funds held positions in its stock, marking a drop from 76 in the first quarter of the year.
More notably, their combined holdings declined by 7.3 percent to $2.03 billion from $2.19 billion quarter-on-quarter.
Meanwhile, BMO Capital on Friday lowered its price target for the stock to $83 from $95 following the abandoned acquisition of Element Solutions. However, it maintained its buy recommendation.
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