Best Buy OK's $5B buyback, raises dividend 7 pct
MINNEAPOLIS (AP) — Best Buy Co. said Tuesday that it will buy back $5 billion of its common stock and raise its quarterly dividend by 7 percent.
Shares of the nation's largest specialty electronics chain rose $1.36, or 4.2 percent, to $32.90 in pre-market trading.
Best Buy says the buyback replaces a $5.5 billion repurchase program that had about $800 million left as of May 28.
The company also plans to pay a quarterly dividend of 16 cents per share on Oct. 25 to shareholders of record on Oct. 4.
Best Buy's announcement came just ahead of its shareholders meeting in Richfield, Minn.
Last week Best Buy reported first-quarter results that topped Wall Street's expectations, helped by a bigger presence in China and renewed focus on hot-selling gadgets like smart phones.
Best Buy has been lauded by industry analysts for its ability to keep costs down and maintain its financial outlook, but there have been concerns about potential threats to its margins going forward as shoppers increasingly head online or to discount stores in an attempt to find the best electronics deals.