U.S. stocks are higher in early Friday afternoon trading, with the Dow Jones Industrial Average (DJINDICES:^DJI) and the S&P 500 (SNPINDEX:^GSPC) are up 0.55% and 0.47%, respectively, at 1:15 p.m. EST. The Dow's outperformance is largely attributable to the 4.58% "pop" Nike Inc shares are enjoying, as the footwear and apparel giant announced a $12 billion share repurchase program, a dividend increase, and an imminent stock split. The Dow is a price-weighted index; today's price action has Nike overtaking Home Depot Inc to become the fifth-largest weighting in the index.

Let's get something out of the way at the beginning: The 2-for-1 stock split, which will occur on Dec. 23, obviously has no effect on the company's intrinsic value, and it doesn't signal much of anything. As such, it should have no impact on fundamental investors' assessment of the stock's attractiveness.

As far as the $0.32 per share quarterly dividend that is to be paid on Jan. 6, it represents a 14% increase. That's in line with the 14.9% annualized growth rate in the dividend over the past 10 years. Furthermore, it marks the 14th consecutive year of annual dividend increases.

That's a very respectable record, but Nike can hardly be considered a dividend stock per se; at 0.89%, its dividend yield is less than half that of the S&P 500, ranking Nike next-to-last compared to its Dow peers. Despite its size (its market capitalization is $112 billion), Nike remains a growth-oriented company.

Finally, the size of the share repurchase program is consequential, as it is equivalent to more than half of the $23 billion Nike has returned to shareholders over the past 12 years. At $12 billion, it's also half as much as the current buyback program, which the company expects to complete before the end of fiscal 2016 (May 31, 2016).

Surprisingly, when Nike announced its current $8 billion buyback program, in September 2012, the stock actually declined 1% the next trading day, compared to a loss of 0.1% for the S&P 500. The $8 billion program was 60% larger than the one it would replace (there was no simultaneous announcement of a dividend increase or stock split).

Last September, roughly two years after that announcement, my Foolish colleague Dan Caplinger called the program a "big win" for Nike.

The stock price reaction to yesterday's announcement suggests investors have come around to Dan's view and are more than satisfied with Nike's capital return policy, which continues to emphasize buybacks over dividends. All that remains for Nike is to just do it.

Alex Dumortier, CFA, has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Nike. The Motley Fool recommends Home Depot. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.