Costco Announces Special $7 Cash Dividend

On Wednesday, Costco (Nasdaq: COST  ) announced that on Dec. 18, it will pay its shareholders a special cash dividend of $7 per share. Payment will be made to shareholders of record as of the close of business on Dec. 10 and will cost the company approximately $3 billion. It will be in addition to the company's regular quarterly dividend of $0.275 per share, which gets paid out Nov. 30.

Costco CFO Richard Galanti described the dividend as Costco's "latest effort in returning capital to our shareholders while maintaining our conservative capital structure," and said the firm's "strong balance sheet," which boasts $4.85 billion cash, makes paying the special dividend possible.

A dividend paid on Dec. 18 -- or any time in 2012, for that matter -- will benefit from the current, low, 15% tax rate on dividends. After Jan. 1, however, the maximum tax rate on dividends could rise as high as 43.4% for some shareholders, if Congress begins taxing dividends at the rates applicable to ordinary income (the highest rate of which should be 39.6%), and applies a 3.8% surtax to pay for the Patient Protection and Affordable Care Act.



Read/Post Comments (1) | Recommend This Article (8)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 29, 2012, at 11:25 AM, aptosjoe wrote:

    According to Schwab the ex date is actually Dec 6 so you need to buy no later than Dec 5th. Looks like a good way to buy a great company at a discount.

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2132105, ~/Articles/ArticleHandler.aspx, 10/21/2016 1:20:25 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,111.44 -50.91 -0.28%
S&P 500 2,137.87 -3.47 -0.16%
NASD 5,250.70 8.87 0.17%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/21/2016 1:04 PM
COST $149.42 Down -0.62 -0.41%
Costco Wholesale CAPS Rating: ****