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Shoppers come out from the Target store in Boston in this file photo. (CHITOSE SUZUKI/CHITOSE SUZUKI/AP)
Shoppers come out from the Target store in Boston in this file photo. (CHITOSE SUZUKI/CHITOSE SUZUKI/AP)

Target eyes $3 dividend by 2017 Add to ...

Target Corp. said on Monday it expects its annual dividend to reach $3 (U.S.) per share or more by 2017, if it meets its profit goals, and plans to continue buying back shares even as it spends money to get ready for its Canadian launch next year.

Target, which said it had completed a $10-billion share repurchase program from 2007, said in a statement it “continues to generate far more cash than we need to fund” its main business.

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The discount chain currently pays an annual dividend of $1.20 per share and is planning to open its first international stores in Canada in 2013.

Target said it would spend about $1.5-billion on buying back shares this year, less than the $1.9-billion it spent in 2011.

But the pace of the repurchases will pick up steam after the launch of its Canadian stores is complete and it has fewer capital expenses.

Target said it would manage its share repurchases in a way that would keep its investment grade credit ratings.

In January, Target’s board directors authorized a $5-billion buyback the retailer expects to complete within two to three years.

Under the previous program, Target bought back 23 per cent of the shares that were outstanding in November 2007, when it was authorized.

The discount retailer has a goal of a profit per share of $8 by 2017. Last fiscal year, Target had earnings of $4.27 per share.

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