Dive Brief:

• Amazon has established a plan to buy back $5 billion worth of shares, according to a Feb. 10 regulatory filing, the first time in six years that the retailer has forged a stock repurchase plan. This plan replaces the 2010 $2 billion repurchase authorization form.

• The period for repurchase is undefined and doesn’t have an expiration date, according to the filing.

• Amazon shares rose more than 2% upon the news, after taking a hammering after its Q4 earnings report missed estimates. 

Dive Insight:

Amazon could be buying back stocks, as companies do, for a couple of reasons—to appease investors at time when they’re disappointed despite its strongest growth showing yet, or to signal that it believes its shares are undervalued.

Amazon’s stock fell hard after its Q4 report, going from a high of $696.44 Dec. 29 to $474 this past Tuesday. The buyback announcement, unsurprisingly, ticked the price back up Wednesday, though its end-of-day price was still down some 27.4% for the year, according to Forbes.

The buyback is fairly easy for the e-retail giant, considering its cash on hand: $15.9 billion in on its balance sheet as of Dec. 31, with $7.3 billion in free cash flow last year, according to Forbes.