The Tile Shop, a Minneapolis-based specialty retailer of natural stone and man-made tiles, has announced the launch of a $30 million share buyback program.

The company’s board unanimously authorized the program Tuesday. Now, the company may purchase shares of its common stock through the open market, private negotiation, or other means.

In a news release announcing the program, CFO Karla Lunan said “we believe our shares are currently undervalued and based on the strength of our balance sheet, coupled with our long-term outlook, an opportunity exists to create value for our shareholders while continuing to invest in our key strategies.”

Buybacks, a common and growing corporate practice, often indicate to investors that a company is confident in its financial prospects. Less shares universally held by shareholders can also increase company’s earnings per share.

The Tile Shop’s net sales were more than $107 million for the second quarter of 2022, an increase of $11.4 million, or 11.9%, from the same time last year, according to The Tile Shop’s last quarterly report. Net income was $6.9 million, up from $5.5 million.

While they have become a common corporate practice, buybacks have also been the target of political debate.

The recent climate and tax legislation signed by president Joe Biden Tuesday imposed a new 1% tax on buybacks, which are forecast to reach $1 trillion in 2022, according to the Associated Press. Tech companies Apple, Facebook’s parent company Meta, and Google’s parent company Alphabet are among the top companies buying back stock.

New York Democrat and Senate majority leader Chuck Schumer has been quoted in multiple news stories criticizing stock buybacks: “I hate stock buybacks. I think they are one of the most self-serving things that corporate America does.”

He and many Democrats believe companies should instead use buyback money to invest back into the business and its employees. The new 1% tax is projected to bring the government an additional $74 billion in revenue over 10 years.

However, experts have acknowledged buybacks can be important to investors.

Repurchases under the Tile Shop’s program will be funded from the company’s existing cash and cash equivalents, borrowings against the company’s credit, and future cash flow. As of June 30, the company had $10.5 million in cash and cash equivalents and $92.6 million available for borrowing on its revolving line of credit.

The repurchase program has no expiration date and may be modified, suspended, or terminated at any time.