The Carter’s board of directors has authorized the babies and children clothing company’s first quarterly dividend, and it plans to repurchase up to $300 million in shares.
The announcement sent Atlanta-based Carter’s shares up $3, or 4.5 percent, Friday for a $69.79 close.
A quarterly cash dividend of 16 cents a share, the first dividend since the company went public in 2003, will be paid June 14 to shareholders of record on May 31.
The stock repurchase includes $38 million remaining under an existing buyback. The plan has no expiration date. Such repurchases can increase earnings per share and boost the market value of remaining shares. Last month Carter’s reported a higher first-quarter profit and revenue.
“The new share repurchase authorization and initiation of a quarterly dividend reflect our confidence in our growth plans as well as our commitment to return excess capital to our shareholders,” Chairman and Chief Executive Officer Michael Casey said in announcing the company’s plans.
Carter’s largest institutional shareholders are Berkshire Partners, Viking Global Investors, Hoplite Capital Management, Matrix Capital Management and Vanguard Group.
The company said it will “assess other opportunities to improve its capital structure” but did not elaborate. Its clothing brands include Carter’s and OshKosh B’gosh.
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