AGF Renews Share Buyback, Betting on Its Value Amid Market Strength

TORONTO, ON – February 06, 2026 – AGF Management Limited (AGF.B) today announced the renewal of its Normal Course Issuer Bid (NCIB), securing approval from the Toronto Stock Exchange (TSX) to repurchase a significant portion of its shares over the next year. The move is widely seen as a strong signal of management's confidence in the company's intrinsic value, coming on the heels of a remarkable run for its stock and a solid fiscal year-end performance.

Under the terms of the renewed bid, the globally diverse asset management firm is permitted to purchase up to 4,693,830 of its Class B Non-Voting Shares, which represents approximately 10% of the public float as of late January. The buyback program is set to commence on February 10, 2026, and will run for one year, concluding on February 9, 2027. This action continues a multi-year strategy of actively managing its capital structure and returning value to shareholders.

A Consistent Strategy of Shareholder Returns

This is not a new tactic for the Toronto-based firm, which was founded in 1957. AGF has a consistent history of using NCIBs as a key lever in its capital allocation strategy. The renewal follows a recently expired bid where AGF acquired 2,757,313 shares between February 2025 and February 2026 at a weighted average price of $13.30.

Looking further back, the company has been even more active when it perceived deeper value. During its 2023-2024 program, it repurchased over 1.8 million shares at an average price of just $7.61. The year prior, it bought back nearly 2.5 million shares at an even lower average price of $6.87. This disciplined, price-sensitive approach to buybacks appears to have paid off for investors.

Over the past 12 months, AGF's stock has delivered a stunning performance, increasing by nearly 60% and significantly outperforming the S&P/TSX Composite Index. This track record suggests that management’s previous assessments of the stock being undervalued were prescient, and the current renewal indicates they believe there is still room for growth despite the recent rally.

Weighing Valuation and Market Headwinds

The decision to repurchase shares is underpinned by the belief that they represent a desirable use of capital, particularly when the market price is attractive relative to the company's long-term prospects. A look at AGF's valuation metrics provides context for this confidence. With a trailing price-to-earnings (P/E) ratio of around 9.6 and a price-to-book (P/B) ratio just under 1.0, AGF appears attractively valued compared to some industry peers. For instance, its P/E and P/B ratios are notably lower than those of competitor IGM Financial.

This perspective is supported by the company's recent financial strength. AGF concluded its 2025 fiscal year on a high note, with fourth-quarter revenues and adjusted earnings beating consensus estimates. Total assets under management and fee-earning assets grew to $60.4 billion, up from $53.6 billion the previous year. However, the picture is not without its complexities. The firm operates in a fiercely competitive asset management sector and has disclosed significant institutional redemptions totaling C$1.2 billion scheduled for fiscal 2026. While some market analysts view the stock as undervalued with further upside, others caution that it may be fully priced after its recent surge, assigning it a high uncertainty rating due to the sector's sensitivity to market fluctuations.

A Dual Mandate: Offsetting Dilution and Incentivizing Talent

Beyond a simple valuation play, AGF's NCIB serves a critical dual purpose related to its corporate structure and talent management. The press release specifies that repurchased shares may either be canceled or held in the AGF Employee Benefit Trust. This provides the firm with a powerful tool to manage shareholder dilution.

Like many public companies, AGF uses equity-based compensation, such as stock options and share units, to attract, retain, and incentivize its employees. It may also issue new shares through its dividend reinvestment plan. While these programs align employee interests with those of shareholders, they can gradually increase the total number of shares outstanding, diluting the ownership stake of existing investors. In fact, despite significant buybacks in recent years, AGF’s total shares outstanding saw a minor increase of 0.85% over the past year, highlighting the persistent dilutive pressure.

By using the NCIB to acquire shares for its employee benefit trust, AGF can satisfy its obligations under these incentive plans without issuing new stock from its treasury. This directly counteracts the dilutive effect, protecting per-share metrics like earnings per share (EPS). This strategic use of the buyback program demonstrates a sophisticated approach to balancing shareholder returns with the need for competitive employee compensation.

The Mechanics of the Buyback: Ensuring Orderly Markets

To execute this large-scale repurchase program, AGF will implement an automatic purchase plan (ASPP) with a designated broker. This is a common and prudent mechanism governed by TSX regulations, designed to ensure the buyback is conducted in an orderly and transparent fashion. The ASPP allows the broker to purchase AGF shares on the open market within pre-determined parameters, even during company-imposed blackout periods when insiders are prohibited from trading.

This structure provides AGF with the flexibility to maintain its repurchase activity throughout the year while adhering to strict regulatory requirements that prevent any potential for market manipulation. Purchases are subject to daily volume limitations. Based on its average daily trading volume of 107,502 shares over the past six months, AGF will generally be limited to buying back a maximum of 26,875 shares on any given day, unless it makes use of a block purchase exemption.

By renewing its NCIB with these robust mechanisms in place, AGF is not only making a statement about its own value but is also demonstrating a continued commitment to a disciplined, multi-faceted capital management strategy designed to navigate a dynamic market and deliver sustainable long-term value to its shareholders.