Talking Costco: Why a special dividend might not be the right play

[Costco Wholesale in Folsom California] Costco (COST [https://seekingalpha.com/symbol/COST]) is widely anticipated to be close to teeing up a special dividend. The retailer started paying special dividends in December 2012 with a one-time payout of $7 per share, which cost about $3B. After that, the company paid $5 per share in February 2015 and $7 per share in May 2017. In November 2020, the board declared a $10 per share special dividend, and the largest one so far was the $6.7B payout in January 2024. While some analysts and income-loving shareholders are expecting the next special dividend in 2027, Mizuho analyst David Bellinger asked whether the capital could be deployed more strategically elsewhere.