VFC boosts shareholder returns through buybacks and dividends
VF Corporation (VFC) is a dividend aristocrat, included in the select group of S&P 500 Index companies that have increased dividends for at least 25 consecutive years. It’s also included in the holdings of the SPDR S&P Dividend ETF (SDY), which invests 1.3% of its portfolio in the company.
VFC has increased dividends for 44 consecutive years. During its 1Q17 results, VFC’s board of directors announced a quarterly dividend of $0.42 per share, a rise of 13.5% YoY. The dividend will be payable on June 19, 2017, to shareholders of record on June 9, 2017.
The company purchased 8.2 million shares for $438.0 million during the first quarter of 2017. In fiscal 2016, it returned ~$1.6 billion to investors through dividends and share buybacks.
In March 2017, VFC’s board of directors approved a $5.0 billion share repurchase plan. Management plans to return $8.0 billion to shareholders between fiscal 2017 and fiscal 2021 through dividends and share repurchases.
VFC has a high dividend payout of ~42.0%. Its stock offered a dividend yield of 3.3%, which was in line with most dividend-paying apparel stocks. In comparison, Hanesbrands (HBI), Gap (GPS), and Ralph Lauren (RL) have current dividend yields of 2.7%, 3.6%, and 2.7%, respectively.
In the next part, we’ll look at analyst recommendations and current valuations for VFC.