Costco Is Paying Out $13 Billion in Special Dividends This Year. Is the Stock a Buy?
Costco is sending shareholders its biggest check yet, but that doesn't settle the question of whether the stock is worth buying.
Costco Wholesale announced a $30-per-share special dividend, totaling $13.3 billion, payable on December 4, 2023. This is the company's sixth special dividend since 2012, and its first since January 2024. The stock is trading at a high valuation, with a forward P/E ratio of 51 and 47 times fiscal 2027 estimates. Despite this, Costco's business continues to thrive amid inflation, with comparable sales up 7.3% in October and online sales increasing 22.5%.
Investors are attracted to the strong foot traffic and growing online business, but the high valuation may present a buying opportunity once it becomes more reasonable.
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