Costco shareholders are about to get 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 a share, along with a 5 cent increase
Shares closed up more than 2 percent on Wednesday. The last retailer in the S&P 500 to pay a special dividend was Best Buy in February of 2016, according to S&P Capital IQ. And that was just a meager 45 cents.
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 will be primarily funded through additional borrowings, Costco said in a release.
Costco shares year-to-date performance
"Our strong balance sheet and favorable access to the credit markets allow us to provide shareholders with this
There has only been one other special dividend this year by a company in the S&P 500, according to S&P Capital IQ's database. Ford announced one in January.
As of Wednesday's close, Costco shares are up 10.42 percent for the year so far, versus the S&P 500's 6.64 percent return over that time.