Target Delivers Dividends
At a recent shareholders’ meeting, the Target board of directors announced on Wednesday that it was boosting its quarterly dividend 19.4 percent to 43 cents a share. Target will pay its next quarterly dividend in September.
The increase ups the annual payout to $1.72, and it advances the company toward its long-term commitment to increase the full-year dividend amount to $3 by 2017. The boosted dividend increases the payout ratio of stock immediately, and the company is now paying out just over 40 percent of its earnings as dividends, compared to 33 percent prior. Additionally, the company has established a target of growing earnings per share to $8 over the same time frame, up from $4.26 last year.
Gregg Steinhafel, Target chairman, president, and CEO, said the company’s strategic clarity and powerful brand would help it deliver results going forward and the REDcard Rewards program (which currently stands at a 17.1% penetration rate) would allow the company to promote loyalty. Steinhafel also said that Target would take smart risks, pursue bold and innovative ideas, and continue to raise the bar on differentiation.