Oops! Target prematurely reveals dividend plans

Kaja Whitehouse | USA TODAY

Target Corporation accidentally revealed a possible dividend increase and a doubling of its stock repurchase program in anticipation of board approval of the plan on Tuesday evening.

Target's shares popped midday Tuesday after a press release was issued on the company's web site announcing that the company's board of directors had okayed a plan to boost the quarterly dividend by 7.7% to 56 cents a share, and increase the stock buyback plan by $5 billion.

But the press release was quickly removed — erasing all the earlier gains in the stock and raising questions about whether Target was the victim of fraud.

A Target official, who was not authorized to speak about the board proposal, said the press release was not a fraud or a hack of Target's web site. It was the result human error in anticipation that the board might approve a plan to increase the dividend by 7.7% and boost the stock buyback to $10 billion.

The company's board is scheduled to meet Tuesday evening ahead of the company's annual shareholder meeting. It could okay the plan revealed Tuesday, or another plan.

Shares of Target closed down 0.01% to $78.88 a share, down from a high of $79.09 a share, reached earlier on Tuesday.

Investors have learned to keep an eye out for false information in the wake of a hoax on shareholders of makeup company Avon last month. Shares of Avon soared as much as 20% in May after a company that identified itself as "PTG Capital Partners" filed what turned out to be a phony $8 billion buyout bid for the makeup company.

The offer represented a 181% premium above the stock's May 13 closing price, according to the SEC's complaint against the alleged perpetrator, Nedko Nedev, 37, of Bulgaria.