Late Friday, department-store operator Dillard's (DDS: scorecard, quote, chart) announced that it will shutter its travel agency business as part of the company's strategy of reducing its underperforming units. The company is attempting to relocate the 160 associates who work in the agencies, which are in 43 of the company's 318 stores.

Meanwhile, the firm's board announced this morning that it will issue a cash dividend of 4 cents per share on the Class A and Class B common stock of the company payable November 3, 2008 to shareholders of record as of September 30, 2008.

Investors appear to be cheered by the news, as the shares are up more than 4% this afternoon. The stock has jumped above short-term resistance at the 13 level, but has backed off from its intraday high of $14.43. The security has been in a strong uptrend since hitting a low of $7.61 in July. The shares have also benefited from support at their ascending 10-day and 20-day moving averages. From a longer-term perspective, the stock is encountering resistance at its descending 20-week trendline.

Meanwhile, pessimism is on the rise toward the retailer. The Schaeffer's put/call open interest ratio has risen from 0.44 on August 22 to its current perch of 0.55, as put open interest has been added at a faster pace than call open interest among near-term options. In fact, the International Securities Exchange (ISE) reports that during the past 10 days, there have been more than 2 puts purchased for every call. This ratio of puts to calls is near an annual high, indicating high levels of investor skepticism.

Short sellers have also flocked to the security in an attempt to call a top to its uptrend. There have been more than 11.8 million shares sold short, accounting for a whopping 20% of the company's total float. An unwinding of these bearish bets could help to add some lift to the shares.