RETAILER Costco Wholesale yesterday said it will pay a special dividend worth some $3bn (£1.9bn) to investors, sending cash to its shareholders ahead of a likely increase in the dividend tax.
The retailer also posted monthly same-store sales that beat analysts’ expectations.
Several companies have declared one-time cash dividends in recent days ahead of a likely increase in the dividend tax rate due to the so-called fiscal cliff – a combination of tax increases and spending cuts due to kick in at the beginning of next year if Congress and the White House cannot reach an agreement on a new deficit cutting plan.
Among those, spirits company Brown-Forman Corp declared a $4-a-share special dividend on Tuesday and casino developer Las Vegas Sands, whose chairman is billionaire Republican donor Sheldon Adelson, announced a special dividend of $2.75 a share on Monday.
“We expect many cash-rich, stable operating companies to follow this trend, along with companies that have high insider ownership,” Janney Capital Markets analyst David Strasser said.
Costco’s special dividend will be paid on 18 December, with the record date set at 10 December.
City A.M. Reporter