Snap-on Incorporated Declares Quarterly Dividend; Announces $500 Million Share Repurchase Authorization

Rhea-AI Summary

Snap-on Incorporated (NYSE: SNA) has announced a quarterly common stock dividend of $1.86 per share, payable on September 10, 2024, to shareholders of record as of August 19, 2024. The company has maintained uninterrupted quarterly dividends since 1939. Additionally, Snap-on's board has authorized a new $500 million share repurchase program, replacing the current program with approximately $260 million remaining. This move, along with an existing program allowing repurchases equal to shares issued under equity plans, underscores Snap-on's commitment to shareholder value. CEO Nick Pinchuk emphasized the company's strong financial position and cash generation, enabling both shareholder returns and strategic investments. Snap-on, an S&P 500 company, reported sales of $4.7 billion in 2023 and is a leading innovator in professional tools and equipment.

Positive

• Declared quarterly dividend of $1.86 per share, maintaining uninterrupted dividend payments since 1939
• Authorized new $500 million share repurchase program, replacing previous program with $260 million remaining
• Strong financial position and robust cash generation reported by CEO
• Generated sales of $4.7 billion in 2023

Negative

• None.

Insights

Financial Analyst

Snap-on's announcement of a $1.86 quarterly dividend and a $500 million share repurchase program demonstrates strong financial health and shareholder commitment. The consistent dividend payments since 1939 showcase remarkable stability. The new buyback program, replacing one with $260 million remaining, signals confidence in future performance. With $4.7 billion in 2023 sales, these shareholder-friendly moves are well-supported by Snap-on's robust cash flow. However, investors should note that while buybacks can boost EPS, they don't directly create value. The impact on stock price will depend on market perception and execution timing.

Market Research Analyst

Snap-on's strategic moves reflect broader market trends. In a high-interest rate environment, dividends become more attractive to investors seeking steady income. The company's 85-year dividend streak is a rare feat, positioning it favorably among income-focused investors. The substantial buyback program aligns with a trend seen across S&P 500 companies, often viewed as a signal of undervaluation. However, it's important to consider the cyclical nature of Snap-on's business. As a tool and equipment manufacturer, its performance is tied to professional user sectors like automotive repair and manufacturing. Investors should monitor economic indicators in these areas to gauge potential impacts on Snap-on's future revenue and ability to maintain these shareholder returns.

KENOSHA, Wis.--(BUSINESS WIRE)-- Snap-on Incorporated (NYSE: SNA) announced that its board of directors has declared a quarterly common stock dividend of $1.86 per share payable on September 10, 2024, to shareholders of record at the close of business on August 19, 2024. Snap‑on has paid consecutive quarterly cash dividends, without interruption or reduction, since 1939.

Snap-on also announced today that its board of directors authorized a share repurchase program of up to $500 million of common stock, replacing the current share repurchase program under which, as of the end of the second quarter of 2024, approximately $260 million of authorization remained. An additional previously approved share repurchase program, which allows the repurchase of up to the number of shares issued under the company’s various equity plans, remains in place. Shares may be repurchased from time to time in the open market or through privately negotiated transactions, subject to applicable laws and regulations.

“This new share repurchase authorization, along with our long-standing dividend program, reinforces our commitment to create ongoing value for our shareholders and demonstrates our firm belief that we’re well-positioned for the future,” said Nick Pinchuk, Snap-on chairman and chief executive officer. “Even during times of turbulence, our strong financial position and robust cash generation enable us in returning capital to our shareholders and in continuing the support for our decisive strategic investments, organically and through acquisitions, along our defined runways for growth and improvement.”

About Snap-on

Snap-on Incorporated is a leading global innovator, manufacturer, and marketer of tools, equipment, diagnostics, repair information and systems solutions for professional users performing critical tasks including those working in vehicle repair, aerospace, the military, natural resources, and manufacturing. From its founding in 1920, Snap-on has been recognized as the mark of the serious and the outward sign of the pride and dignity working men and women take in their professions. Products and services are sold through the company’s network of widely recognized franchisee vans, as well as through direct and distributor channels, under a variety of notable brands. The company also provides financing programs to facilitate the sales of its products and to support its franchise business. Snap-on, an S&P 500 company, generated sales of $4.7 billion in 2023, and is headquartered in Kenosha, Wisconsin.

Forward-looking Statements

Statements in this news release that are not historical facts, including statements that (i) are in the future tense; (ii) include the words “expects,” “anticipates,” “intends,” “approximates,” or similar words that reference Snap-on or its management; (iii) are specifically identified as forward-looking; or (iv) describe Snap-on’s or management’s future outlook, plans, estimates, objectives or goals, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Snap-on cautions the reader that this news release may contain statements, including earnings projections, that are forward-looking in nature and were developed by management in good faith and, accordingly, are subject to risks and uncertainties regarding Snap-on’s expected results that could cause (and in some cases have caused) actual results to differ materially from those described or contemplated in any forward-looking statement. In particular, Snap-on cannot provide assurances regarding any specific market reaction to share repurchases, or related effects on the value of its shares, because that reaction is not under the company’s control and is subject to changes in the market unrelated to Snap-on, nor can Snap-on provide any assurances regarding its ability to repurchase shares on acceptable terms. Market conditions may also affect whether any repurchases are in fact accretive. Additional factors that may cause the company’s actual results to differ materially from those contained in the forward-looking statements include those found in the company’s reports filed with the Securities and Exchange Commission, including the information under the “Safe Harbor” and “Risk Factors” headings in its Annual Report on Form 10-K for the fiscal year ended December 30, 2023, which are incorporated herein by reference. Snap-on disclaims any responsibility to update any forward-looking statement provided in this news release, except as required by law.

For additional information, please visit www.snapon.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240808645095/en/

Investors:

Sara Verbsky

262/656-4869

Media:

Samuel Bottum

262/656-5793

Source: Snap-on Incorporated

FAQ

What is Snap-on's new quarterly dividend amount and when is it payable?

Snap-on (SNA) has declared a quarterly dividend of $1.86 per share, payable on September 10, 2024, to shareholders of record as of August 19, 2024.

How much is Snap-on's new share repurchase authorization?

Snap-on (SNA) has authorized a new share repurchase program of up to $500 million of common stock.

How long has Snap-on been paying consecutive quarterly dividends?

Snap-on (SNA) has been paying consecutive quarterly cash dividends, without interruption or reduction, since 1939.

What were Snap-on's sales figures for 2023?

Snap-on (SNA) reported sales of $4.7 billion for the year 2023.