ARCA Biopharma Inc (NASDAQ:ABIO) shares are trading higher by 12.5% to $3.32 Monday morning after the company, on Friday, announced a special dividend of $1.59 per share in connection with the upcoming merger with Oruka Therapeutics.

The dividend will be paid to stockholders of record as of August 26, with payment scheduled for August 28.

The company says the exact dividend amount may vary depending on ARCA's net cash exceeding $5 million before the merger closes. The dividend payment is contingent upon ARCA stockholders approving the merger at a meeting on August 22, with the merger expected to close on August 29.

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Is ABIO A Good Stock To Buy?

An investor can make a few decisions when deciding whether a stock is a good buy. In addition to valuation metrics and price action which you can find on Benzinga's quote pages – like ARCA biopharma's page for example – there are factors like whether or not a company pays a dividend or buys a large portion of its stock each quarter.

These are known as capital allocation programs. ARCA Biopharma does not pay a dividend, but obviously has a few ways it can return value to shareholders. Feel free to search Benzinga's dividend calendar for the next company that is due to pay a dividend and determine what kind of yield you can earn for holding a share of the company.

Buyback programs are obviously different and highly variable. A company can approve a buyback program and purchase shares as it sees fit over the course of time in which the buyback was authorized. Looking through the latest news on ARCA biopharma will often yield whether or not the company has approved a buyback program recently. Buyback programs usually serve as a support for share prices, serving as a backstop for demand.

According to data from Benzinga Pro, ABIO has a 52-week high of $4.49 and a 52-week low of $1.56.