Costco (NASDAQ: COST) shareholders can look forward to a nice payout and a rare one from a retailer.
The wholesale retailer who has ducked the woes of most other brick-and-mortar stores announced Tuesday a special cash dividend of $7.00 U.S. a share, along with a five-cent increase of its quarterly cash dividend to 50 cents a share.
The one-time distribution typically only comes when things are going especially well. The last retailer in the S&P 500 to pay a special dividend was Best Buy (NYSE: BBY) in February 2016, and meager 45 cents at that.
There has only been one other special dividend this year by a company in the S&P 500, announced by Ford (NYSE: F) in January.
A company release said the special payout on common stock by Costco will be paid on May 26 to shareholders of record at the close of business May 10. The total payment of about $3.1 billion U.S. will be primarily funded through additional borrowings
Even more noteworthy, Costco shares were up 7.9% for the year so far, as of Tuesday’s close, versus the S&P 500’s return of 6.7% return over that time.
Costco currently operates more than 700 warehouses, including more than 500 in the United States and Puerto Rico, 95 in Canada, 37 in Mexico, 28 in the United Kingdom, 25 in Japan, 13 in Korea, 13 in Taiwan, eight in Australia and two in Spain.
Costco shares headed toward noon ET on Wednesday up $3.40, or nearly 2%, to $176.08 U.S.