Retail giant Costco Wholesale (COST) has increased its quarterly dividend by 13%.
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Moving forward, Costco will pay its stockholders a quarterly dividend of $1.47 per share, a 13.1% increase from the previous distribution of $1.30. On an annual basis, Costco shareholders will earn $5.88 a share. The increased dividend will be payable on May 15 of this year to stockholders of record on May 1. The ex-dividend date is April 30.
The increase brings the annual dividend yield on COST stock to 0.60%. Costco has now raised its dividend for 22 consecutive years. The company is known for consistent dividend growth, with a 1,200% total increase since 2004. Costco is on the cusp of becoming a Dividend Aristocrat, which are companies that have increased their dividend payouts for 25 consecutive years or longer.
What About the Special Dividend?
Costco Wholesale also has a history of paying special dividends to shareholders every few years. In 2017, the company paid a one-time dividend of $7 per share; in 2020 it paid a special dividend of $10 a share; and in 2023 a special dividend was declared that was worth $15 per share.
Shareholders are wondering when Costco will next pay a special dividend, which are issued in addition to the quarterly distributions. Some analysts attribute the slide in COST stock over the past six months to the fact that management has not announced another special dividend payment. Special dividends are typically used to return excess cash to shareholders.
Is COST Stock a Buy?
Costco’s stock has a consensus Moderate Buy rating among 23 Wall Street analysts. That rating is based on 16 Buy, six Hold, and one Sell recommendations issued in the last three months. The average COST price target of $1,097.28 implies 11.43% upside from current levels.
