Why SSR Mining Stock Popped Today
Key Points
SSR Mining is reinstating its dividend at 0.4%.
The gold miner is also buying back $500 million in stock -- after having just bought back $300 million.
SSR Mining (NASDAQ: SSRM) stock struck gold on Tuesday, soaring 9% in the first 10 minutes of trading.
Investors in the gold mining stock appear pleased by SSR's announcement yesterday that it is ready to reinstate its dividend and will also buy back $500 million of its own stock. The twin moves also prompted RBC Capital to double down on its "outperform" rating on the stock, and reiterate its $40 price target -- implying SSR stock could gain 27% over the next 12 months.
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SSR mines cash
SSR Mining spent $300 million buying back stock in Q2 2026. With shares having retreated a bit since the stock approached $36 in May, SSR now plans to spend even more, redeploying the $1.5 billion it expects to receive from selling its Turkish Copler mine to reinvest in itself.
Additionally, SSR will resume paying a quarterly dividend of $0.03 -- $0.12 per year -- which works out to about a 0.4% dividend yield (which I admit is pretty puny).
Dividends or buybacks?
SSR Mining didn't say how quickly it intends to spend its $500 million on buybacks. Assume it does it all in one year, however. That would mean the company is returning $500 million to shareholders through buybacks, versus only $24.8 million in dividends.
What does this tell you?
It tells me that SSR Mining views its shares as very cheap indeed, enough so that the best way to reward investors for sticking with SSR stock is to increase the value of their shares by buying back excess stock (rather than paying a bigger dividend).
RBC, in its note, calls this decision "positive" for SSR stock. Most investors today seem to agree -- and so do I.
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Rich Smith has positions in SSR Mining. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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