Carter's Inc. (CRI) shares plummeted 5.15% in intraday trading on Tuesday, as investors reacted negatively to the company's announcement of a proposed $500 million senior notes offering. The children's apparel retailer's stock took a hit despite several analyst price target increases, suggesting concerns about the company's debt levels and financial strategy.

The company revealed that its wholly-owned subsidiary, The William Carter Company, intends to offer $500 million aggregate principal amount of senior notes due 2031. Carter's plans to use the net proceeds from this offering, along with cash on hand, to redeem all of its outstanding 5.625% senior notes due 2027 and to pay related fees and expenses. While this move aims to restructure the company's debt, it appears to have spooked some investors, possibly due to concerns about increased leverage or the need for additional financing.

Despite the stock's sharp decline, several analysts adjusted their price targets for Carter's. UBS raised its target from $26 to $33, maintaining a Neutral rating. Citigroup increased its target to $34 from $28, while Barclays and Wells Fargo also raised their targets slightly. However, these positive adjustments were not enough to offset the market's negative reaction to the debt offering news. The mixed signals from analysts and the company's financial moves have left investors uncertain about Carter's near-term prospects, contributing to the significant stock price drop.