Best Buy Ups Dividend, Unveils $5B Buyback Plan

By Retail FOXBusiness

Best Buy (BBY) announced plans on Tuesday to boost its dividend by 7% and buy back $5 billion of stock, sending shares of the worlds largest consumer electronics retailer rallying 4% higher.

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The moves demonstrate confidence on behalf of the management of the Richfield, Minn.-based company, which last week revealed stronger-than-expected fiscal first-quarter results amid strong mobile sales growth.

Best Buy's business generates significant cash flow and we are committed to using that cash in a disciplined manner," CEO Brian Dunn said in a statement.

Best Buy, which is holding its annual shareholder meeting on Tuesday, raised its quarterly cash dividend by a penny to 16 cents a share. The new dividend will be payable on October 25 to shareholders of record as of October 4.

At the same time, Best Buy said its board has signed off on a new $5 billion share buyback program that will replace a previous $5.5 billion one that had just $800 million remaining.

We are very pleased to announce this new share repurchase program that underscores our commitment to enhancing returns for shareholders, said Dunn.

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Shareholders cheered the moves, bidding Best Buys stock higher. Thanks to recent rallies, Best Buys stock was off just 8% on the year as of Mondays close.

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