Premier Investments Limited (ASX: PMV) shares hit a new all-time high last week after the clothing retailer announced a bumper first half that smashed analysts' expectations and set the group up for a market-beating return in 2015.
What Happened? Premier announced a 50% increase in its interim dividend to 30 cents per share on the back of a 4.2% jump in revenue to $497 million and 9.1% rise in profit to $56.8 million in the six months to January 24, these numbers corresponded to earnings per share of 36 cents.
What now? Analysts now expect the company to deliver full year net profit of around $90 million, or 57 cents per share, and a dividend of up to 50 cents. This corresponds to a yield of 4%, fully franked.
Is outperformance guaranteed? A recent study by the number crunchers at Macquarie Group Ltd (ASX: MQG) found that companies that reward investors with share buybacks and special dividends have outperformed the market by up to 4.4% per annum over the last 30 years.
The report found the share price tends to outperform the market by over 2% in the lead up to the ex-dividend date and perform well following it, in anticipation of further payouts.
Is it too late to buy? Premier's shares are already up 29% this year, smashing the 9% return from the ASX 200. The major benefit of investing in Premier is that it's showing the rest of the Australian retail companies that perhaps life isn't as tough as they're making it out to be.
Peers OrotonGroup Limited (ASX: ORL), Metcash Limited (ASX: MTS), Woolworths Limited (ASX: WOW), Specialty Fashion Group Ltd. (ASX: SFH) and Kathmandu Holdings Ltd (ASX: KMD) have all disappointed investors with poor like-for-like sales growth and pessimistic outlooks, while Premier is forecasting a strong second half.
