Prudential Shares Soar 2.03% on Share Buyback

Prudential's share price surged to its highest level since November 2023 today, with an intraday gain of 2.03%.

The strategy of buying PUK shares after they reached a recent high and holding for 1 week yielded moderate returns over the past 5 years, with a 7.55% annualized return. However, the Sharpe ratio was low at 0.47, indicating that the risk-adjusted returns were modest. The strategy showed a maximum drawdown of -10.5% during the 2025 crash, reflecting its vulnerability during market downturns. Overall, while the strategy provided some growth, it was not without its risks, as evidenced by the significant drawdown during the recent market volatility.

Prudential plc recently executed a share buyback, repurchasing 700,000 ordinary shares at an average price of GBP 8.51 with the intention to cancel them. This move is often seen as a positive signal for investors, as it reduces the number of shares available, potentially increasing earnings per share and demonstrating management's confidence in the company's financial health.