After the stock market closed Wednesday, Barnes & Noble announced it is maintaining its 15-cent dividend this quarter and expects consolidated EBITDA (earnings before interest, taxes, depreciation and amortization) for the next fiscal year to be in a range of $175 million-$200 million, substantially above consensus estimates of about $145 million. It said the gain would come "through improved sales trends and expense reductions."
Wall Street liked the news: yesterday shares of B&N rose 7.5%, to $5.15 a share, its highest level in two months.
At its recent share price of about $4.80, the 60-cent-a-year dividend represents a yield of more than 12%, a very high level and usually a sign that investors don't believe the dividend can be maintained for long. The 15-cent dividend will be paid on April 27 to stockholders of record on April 6.