Oct. 27 (Bloomberg) -- International Business Machines Corp., the world’s largest computer-services provider, will add $5 billion to its plan to repurchase stock, rewarding shareholders after back-to-back quarters of profit gains.

The increase, following the stock’s 43 percent jump this year, adds to the $4.2 billion left in IBM’s original buyback program at the end of September, the Armonk, New York-based company said today in a statement.

“It’s very consistent with how they’ve been returning capital to shareholders over many years,” said Chris Hickey, a technology analyst at Atlantic Equities LLP in London. “It’s clearly confirmation that they’re still buying back shares after the huge run the stock has had.”

IBM, led by Chief Executive Officer Sam Palmisano, said it has returned more than $70 billion to shareholders in the past six years. This month the company raised its forecast for annual earnings to at least $9.85 a share after posting a 14 percent gain in profit for the third quarter.

The company reported $11.5 billion in cash at the end of September. IBM is among a growing roster of companies to resume share repurchases, which had been halted during the economic slowdown. Travelers Cos. said this month its board approved $6 billion in stock repurchases and boosted its dividend.

Nestle

Nestle SA, the world’s largest food company, said last week it will buy back 7 billion Swiss Francs ($6.9 billion) of shares this year. The company increased its shares target because of a “solid operational performance” in the year. Nestle previously said it had a 4 billion franc target.

Visa Inc. today said it plans to buy back as much as $1 billion in shares. The San Francisco-based company, the world’s biggest electronic-payment network, also increased its quarterly dividend payment by 19 percent.

IBM rose 54 cents to $120.65 at 4 p.m. in New York Stock Exchange composite trading. The stock has advanced 43 percent this year.

IBM boosted its stock repurchase plan in April by $3 billion, after announcing a $15 billion buyback program last year. With the combined $9.2 billion, IBM has the capacity to repurchase as many as 76 million shares, or about 6 percent of its shares outstanding as of Sept. 30.

To contact the reporter on this story: Julie Alnwick in New York at jalnwick@bloomberg.net

Last Updated: October 27, 2009 16:16 EDT