Shares of SharpLink Gaming saw a slight decline despite the ongoing stock repurchase program initiated by the Ethereum treasury firm. In their latest move, SharpLink purchased an additional 1 million shares at an average price of $16.67 each. However, the company’s stock price dipped by 2.8% to $16.32 in the afternoon trading session in New York.
The stock repurchases are part of a $1.5 billion authorization approved in August. So far, SharpLink has bought back nearly 1.93 million shares for approximately $32 million. The firm has been funding these repurchases using cash reserves, staking income, and other financing options rather than taking on additional debt.
In addition to the buyback program, SharpLink has been steadily increasing its Ethereum balance sheet. As of September 16, the company reported holding 838,152 ETH, up from 740,760 tokens the previous month, with a total value of around $3.86 billion. This includes 3,240 ETH earned through staking activities since June.
Backed by Ethereum developer Consensys, SharpLink is now the second-largest corporate holder of ETH, trailing only Bitmine Immersion, which controls over 2 million tokens. Together, these two firms hold the majority of Ethereum assets among the approximately 70 public digital asset treasury companies that own at least 100 ETH each.
SharpLink has a strategic approach to its buyback program, only repurchasing shares when its net asset value (NAV) falls below 1. This indicates that the stock is undervalued relative to its crypto holdings. As of September 15, SBET’s NAV stood at 0.91x, suggesting that the market was pricing its shares at a 9% discount compared to its ether reserves.
While buyback programs are a contentious issue in the crypto space, SharpLink CEO Joseph Chalom, a former BlackRock executive, defends the strategy as being “immediately accretive” and beneficial for long-term shareholder returns. The company aims to align shareholder value with Ethereum’s growth trajectory by utilizing token accumulation and selective buybacks to capitalize on buying low and selling high opportunities.
Despite experiencing a surge in share price earlier this year following a partnership announcement with Consensys, which briefly pushed the stock above $78 in June, SharpLink’s stock has since retraced. Nevertheless, the company remains steadfast in its commitment to maximizing shareholder value in tandem with Ethereum’s growth trajectory.