Costco Wholesale Corporation (NASDAQ:COST) to Issue Quarterly Dividend of $1.47

Key Points

• Costco declared a quarterly dividend of $1.47 per share (a 13.1% increase), payable May 15 to shareholders of record on May 1, implying an annualized dividend of $5.88 and a yield of about 0.6%.
• The dividend looks sustainable: Costco has raised its payout for 22 consecutive years and maintains a low payout ratio of roughly 26%, with analyst earnings forecasts that keep the expected future payout ratio near 26.4%.
• Recent results show continued strength—Q earnings of $4.58 per share beat estimates and revenue rose 9.2% year-over-year to $69.6 billion—while the stock trades near $985 with a market cap of about $437 billion and a P/E around 51x.

Costco Wholesale Corporation (NASDAQ:COST - Get Free Report) announced a quarterly dividend on Wednesday, April 15th. Investors of record on Friday, May 1st will be given a dividend of 1.47 per share by the retailer on Friday, May 15th. This represents a c) annualized dividend and a yield of 0.6%. The ex-dividend date is Friday, May 1st. This is a 13.1% increase from Costco Wholesale's previous quarterly dividend of $1.30.

Costco Wholesale has increased its dividend payment by an average of 0.1%annually over the last three years and has increased its dividend annually for the last 22 consecutive years. Costco Wholesale has a payout ratio of 26.1% meaning its dividend is sufficiently covered by earnings. Research analysts expect Costco Wholesale to earn $19.69 per share next year, which means the company should continue to be able to cover its $5.20 annual dividend with an expected future payout ratio of 26.4%.

Costco Wholesale Price Performance

Costco Wholesale stock opened at $984.75 on Thursday. Costco Wholesale has a 52 week low of $844.06 and a 52 week high of $1,067.08. The business has a 50-day simple moving average of $995.81 and a 200 day simple moving average of $943.83. The company has a quick ratio of 0.59, a current ratio of 1.06 and a debt-to-equity ratio of 0.18. The stock has a market cap of $436.88 billion, a price-to-earnings ratio of 51.21, a PEG ratio of 4.80 and a beta of 0.99.

Costco Wholesale (NASDAQ:COST - Get Free Report) last released its quarterly earnings results on Wednesday, March 11th. The retailer reported $4.58 earnings per share for the quarter, beating the consensus estimate of $4.55 by $0.03. The firm had revenue of $69.60 billion for the quarter, compared to analysts' expectations of $68.96 billion. Costco Wholesale had a return on equity of 28.57% and a net margin of 2.99%.The company's revenue was up 9.2% compared to the same quarter last year. During the same quarter last year, the firm posted $4.02 EPS. On average, research analysts forecast that Costco Wholesale will post 18.03 earnings per share for the current fiscal year.

Insider Activity at Costco Wholesale

In other Costco Wholesale news, EVP Teresa A. Jones sold 850 shares of the stock in a transaction that occurred on Wednesday, January 21st. The shares were sold at an average price of $986.26, for a total transaction of $838,321.00. Following the transaction, the executive vice president directly owned 4,228 shares in the company, valued at $4,169,907.28. This trade represents a 16.74% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, EVP Claudine Adamo sold 730 shares of Costco Wholesale stock in a transaction that occurred on Monday, March 9th. The stock was sold at an average price of $1,003.02, for a total transaction of $732,204.60. Following the transaction, the executive vice president directly owned 6,121 shares in the company, valued at $6,139,485.42. This trade represents a 10.66% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last three months, insiders have sold 2,038 shares of company stock valued at $2,007,916. Corporate insiders own 0.10% of the company's stock.

Institutional Investors Weigh In On Costco Wholesale

Institutional investors have recently made changes to their positions in the business. Gunpowder Capital Management LLC dba Oliver Wealth Management bought a new stake in Costco Wholesale in the fourth quarter worth $27,000. Lifetime Wealth Management P.C. bought a new position in shares of Costco Wholesale during the fourth quarter valued at about $28,000. Mcguire Capital Advisors Inc. bought a new position in shares of Costco Wholesale during the fourth quarter valued at about $28,000. Hurley Capital LLC increased its holdings in shares of Costco Wholesale by 120.0% in the third quarter. Hurley Capital LLC now owns 33 shares of the retailer's stock worth $31,000 after buying an additional 18 shares during the period. Finally, Entrust Financial LLC purchased a new position in shares of Costco Wholesale in the fourth quarter worth about $31,000. Hedge funds and other institutional investors own 68.48% of the company's stock.

About Costco Wholesale

Costco Wholesale Corporation operates a global chain of membership-only warehouse clubs that sell a wide array of merchandise in bulk at discounted prices. The company's product mix includes groceries, fresh and frozen food, household goods, electronics, apparel, and seasonal items, augmented by its prominent private-label brand, Kirkland Signature. Costco's business model centers on annual membership fees and high-volume, low-margin sales, designed to drive repeat purchasing and strong customer loyalty among both consumers and small-business buyers.

Beyond merchandise, Costco provides a range of ancillary services that complement its warehouses, including gasoline stations, pharmacy and optical services, hearing aid centers, photo services, and travel and insurance products.

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