Hanesbrands Initiates Dividend - Analyst Blog
09 4월 2013 - 2:00AM
Zacks
The leading apparel retailer, Hanesbrands Inc.
(HBI), announced that it will initiate its dividend payback policy.
In the recently held Investor Day conference call, the company
announced that it will pay a regular quarterly dividend of 20 cents
per share starting from June 3, 2013 to stockholders of record at
the close of business on May 20, 2013. The annualized dividend per
share stands at 80 cents per share. The dividend yield is
58.6%.
The initiation of the quarterly dividend is a part of the company’s
cash deployment strategy. The apparel chain is settled in a solid
free cash flow position with a price to free cash flow ration of
10. Hanesbrands intends to use almost 20% to 25% of its free cash
flow to pay dividend.
Winston-Salem, NC-based Hanesbrands is geared to maximize returns
to shareholders. Apart from paying in the form of dividends, the
company also intends to repurchase shares, although it is yet to
formulate its share buyback strategy.
Signs of economic recovery have made share buybacks and dividend
increases a common factor among companies with ample cash. Apart
from enhancing shareholders’ return, an attractive dividend payment
strategy lifts the market value of the stock.
In the conference call, Hanesbrands highlighted its Innovate to
Elevate Strategy as a part of boosting its earnings. The Innovate
to Elevate strategy aims at using product innovation to enhance the
brand value of the company. The company also revealed that apart
from paying dividends and buying back shares, the company will use
its cash for bolt-on acquisitions.
For the first quarter 2013, Hanesbrands expects sales to be $945
million. Operating profits are expected between $82 million and $85
million for the quarter. Earnings are expected to lie within the
range of $0.48 to $0.51 per share.
For full year 2013, the company reaffirmed its sales guidance of
$4.6 billion. It expects operating profits between $500 million to
$550 million for the year. Earnings are expected to lie within the
band of $3.25 to $3.40 per share.
Hanesbrands engages in marketing innerwear, outerwear and hosiery
apparel and carries a Zacks Rank #2 (Buy). Other stocks in the same
industry that worth a look include Michael Kors Holding
Limited (KORS), Joe’s Jeans Inc. (JOEZ)
and Ralph Lauren Corporation (RL). All of them
carry a Zacks Rank #2 (Buy).
HANESBRANDS INC (HBI): Free Stock Analysis Report
JOES JEANS INC (JOEZ): Free Stock Analysis Report
MICHAEL KORS (KORS): Free Stock Analysis Report
RALPH LAUREN CP (RL): Free Stock Analysis Report
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