Everything is bigger at Costco (Nasdaq: COST), from massive jugs of olive oil to five-gallon buckets of dill pickles. You’ll even find 60-pound tubs of pure honey.
Of course, the stock price is hefty as well. With no stock splits since 2000, the shares have been allowed to freely rise. And rise they have… from $700 in February 2024 to $800 three months later and then $900 by the end of the year. COST then spent much of 2025 in four-digit territory, and it continues to flirt with that level today.
Why should the dividends be any different?
There’s a regular quarterly distribution of $1.30 per share, but that provides a pint-sized yield of just 0.5%. No, I’m referring to the whopping special dividends that Costco hands out every two to three years.
The first was a $3 billion outlay in 2012 that amounted to $7.00 per share. The board approved another multi-billion dollar payout in 2015, and then again in 2017.
The next big special dividend came three years later in December 2020, when shareholders were treated to a record lump sum of $6.7 billion, or $10.00 per share. For perspective, that single distribution was equivalent in size to 13 regular quarterly dividends – all at once.
Investors were clamoring for another in December 2023, and Costco delivered right on cue. With four straight quarterly earnings beats under its belt and a growing cash stockpile, the company handed out a massive payment of $15.00 per share.
If that pattern holds, we could be looking at the next big cash distribution later this year. And with aggressive buybacks shrinking the share count over the years, these handouts now stretch even further on a per-share basis.
Costco’s footprint has expanded to 780 wholesale warehouses across North America, with a growing international presence from Australia to Japan. Paid membership continues to climb and now stands at 80 million households. Multiply that by an annual membership fee of $65 (or $130 for an executive card), and you’re looking at $5+ billion in recurring annual income… before tallying up the contents of the first shopping cart.
The company kicked off fiscal 2026 with $65 billion in first quarter sales, a healthy uptick of 8%. The market will scrutinize internal metrics like comparable store traffic, average ticket size and gross margins (which are thin in this industry). But even when they slide, Costco is lean and efficient, scaling its administrative overhead over a growing revenue base and churning out $2.5+ billion in quarterly pre-tax profits.
And with sticky, high-margin membership renewal rates of 90%, you could argue this is more of a subscription business than a standard retailer.
In any case, while special dividends are, by definition, erratic and unpredictable, Costco likes to make these supplemental payments every few years. So it’s about time for that cash spillover bucket to tip once again. And with the cash stockpile growing from $10 billion to $16 billion over the past 12 months, this could be the biggest one yet.
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