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Hanesbrands (HBI) Hikes Dividend; Boosts Shareholder Value
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Recently, Hanesbrands Inc.’s (HBI - Free Report) board of directors announced a hike of 36% in its quarterly dividend to 15 cents per share. The new dividend will be paid on Mar 7 to shareholders on record as of Feb 14, 2017. The annualized dividend amounts to 60 cents per share with a dividend yield of 2.7%, based on Hanesbrands’ closing price of $22.63 as of Jan 24, 2017. Last year, the company increased its dividend by 10%.
The leading basic apparel retailer initiated its dividend payback policy in Apr 2013. It paid a quarterly dividend of 20 cents per share starting from Jun 3, 2013.
Since then Hanesbrands has hiked its dividend every year. The dividend increase announced on Jan 24, marked the company’s fourth consecutive hike.
The recent dividend hike and enhanced buyback program reflect the company’s strong cash position and a solid balance sheet.
Winston-Salem, NC-based Hanesbrands is geared to maximize returns to shareholders. Apart from paying in the form of dividends, the company also buys back shares. During third-quarter 2016, Hanesbrands repurchased $379.9 million shares compared with $306.1 million shares in third-quarter 2015.
Signs of economic recovery have made share buybacks and dividend increases a common factor among companies with ample cash. This initiative enhances shareholders’ return and is an attractive dividend payment strategy that lifts the market value of the stock.
However, Hanesbrands is plagued with currency headwinds, soft sales in the Activewear and direct-to-consumer segments, and a lackluster performance of the Champion brand. Notably, it has also lowered its fiscal 2016 guidance as it anticipates soft results in the upcoming fourth quarter. Consequently, the dismal performance has been reflected in the share price movement as well. In the past one year, the shares of this retailer have declined 25.2%, underperforming the Zacks categorized Consumer Discretionary industry which has declined only 9%.
Zacks Rank & Other Stock Picks
Hanesbrands currently carries a Zacks Rank #4 (Sell).
Better-ranked stocks in the broader consumer discretionary sector are Michael Kors Holdings Limited , Francesca’s Holdings Corporation and Tailored brands Inc. .
Tailored Brands and Francesca’s Holdings both sport a Zacks Rank #1 (Strong Buy) and has an expected earnings growth of 17.5% and 13.8%, respectively. You can see the complete list of today’s Zacks #1 Rank stocks here. Michael Kors carries a Zacks Rank #2 (Buy). The company has an expected earnings growth of 9.6%.
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Hanesbrands (HBI) Hikes Dividend; Boosts Shareholder Value
Recently, Hanesbrands Inc.’s (HBI - Free Report) board of directors announced a hike of 36% in its quarterly dividend to 15 cents per share. The new dividend will be paid on Mar 7 to shareholders on record as of Feb 14, 2017. The annualized dividend amounts to 60 cents per share with a dividend yield of 2.7%, based on Hanesbrands’ closing price of $22.63 as of Jan 24, 2017. Last year, the company increased its dividend by 10%.
The leading basic apparel retailer initiated its dividend payback policy in Apr 2013. It paid a quarterly dividend of 20 cents per share starting from Jun 3, 2013.
Since then Hanesbrands has hiked its dividend every year. The dividend increase announced on Jan 24, marked the company’s fourth consecutive hike.
The recent dividend hike and enhanced buyback program reflect the company’s strong cash position and a solid balance sheet.
Winston-Salem, NC-based Hanesbrands is geared to maximize returns to shareholders. Apart from paying in the form of dividends, the company also buys back shares. During third-quarter 2016, Hanesbrands repurchased $379.9 million shares compared with $306.1 million shares in third-quarter 2015.
Signs of economic recovery have made share buybacks and dividend increases a common factor among companies with ample cash. This initiative enhances shareholders’ return and is an attractive dividend payment strategy that lifts the market value of the stock.
However, Hanesbrands is plagued with currency headwinds, soft sales in the Activewear and direct-to-consumer segments, and a lackluster performance of the Champion brand. Notably, it has also lowered its fiscal 2016 guidance as it anticipates soft results in the upcoming fourth quarter. Consequently, the dismal performance has been reflected in the share price movement as well. In the past one year, the shares of this retailer have declined 25.2%, underperforming the Zacks categorized Consumer Discretionary industry which has declined only 9%.
Zacks Rank & Other Stock Picks
Hanesbrands currently carries a Zacks Rank #4 (Sell).
Better-ranked stocks in the broader consumer discretionary sector are Michael Kors Holdings Limited , Francesca’s Holdings Corporation and Tailored brands Inc. .
Tailored Brands and Francesca’s Holdings both sport a Zacks Rank #1 (Strong Buy) and has an expected earnings growth of 17.5% and 13.8%, respectively. You can see the complete list of today’s Zacks #1 Rank stocks here. Michael Kors carries a Zacks Rank #2 (Buy). The company has an expected earnings growth of 9.6%.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>