Costco’s Slowing Sales and Lagging Stock Dim Prospects for a December Special Dividend

Costco Wholesale Corp. is scheduled to release fiscal first-quarter 2026 results on Thursday, Dec. 11, and shareholders traditionally look to the earnings date for news of an extra cash payout. The warehouse club has issued several large special dividends over the past decade, but the company’s recent performance suggests that another windfall is unlikely this time.

Costco’s stock is down a little more than 2% year-to-date through early December, while the S&P 500 has advanced about 17% over the same period. The gap represents Costco’s weakest showing against the benchmark index since 2002. By contrast, the shares climbed 39% in 2024, easily outpacing the market’s 25% gain and sending the retailer into the new year trading at more than 50 times earnings—well above peers such as Walmart and Target.

The divergence reflects a deceleration in the company’s core metrics. Management reported that comparable-store sales, a key indicator of underlying demand, rose 5.8% in the fourth quarter of fiscal 2025. The growth rate cooled further in November, slipping to 6.4% on a company-wide basis. Although mid-single-digit growth would be healthy for many retailers, the slowdown contrasts with the high-teens comps Costco delivered during the pandemic rebound and underscores a more cautious consumer mood.

Analysts attribute the moderation to inflation-weary shoppers who are postponing or downsizing big-ticket purchases. Costco’s model is built around bulk buying and value pricing, but even its members appear to be trimming discretionary spending. That dynamic has tempered revenue momentum and raised questions about how aggressively management will deploy excess cash.

The company’s regular dividend policy remains intact. Costco has lifted its quarterly payout every year for 21 consecutive years, reinforcing its reputation for disciplined capital allocation. Special dividends, however, have been discretionary and typically timed to periods of exceptional operating strength or unusual cash accumulation. The retailer paid $10 per share in 2020, $7 per share in 2017 and $5 per share in 2015, moves that collectively returned billions of dollars to shareholders.

With the current year’s earnings trajectory tracking below investor expectations and the share price no longer outperforming the market, management has less incentive to declare another one-time distribution. Instead, the company may opt to preserve liquidity for core investments such as new warehouse openings, e-commerce capabilities and potential membership fee adjustments. Costco finished fiscal 2025 with solid cash reserves, but observers note that capital expenditures have been climbing as the retailer expands overseas and upgrades its supply chain.

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Any decision on a special dividend is expected to be communicated alongside first-quarter results. Historically, the company has coupled such announcements with earnings releases rather than standalone press statements. Investors seeking detailed historical data on prior dividends can review Costco’s filings available through the U.S. Securities and Exchange Commission.

Absent an unexpected surge in sales or profitability, most analysts anticipate that Costco will limit shareholder returns to its regular quarterly payout in the near term. The financial update on Dec. 11 will therefore focus on comparable-store sales trends, membership renewal rates and margin pressures heading into the important holiday quarter. Those indicators may offer clearer clues about whether the company can reignite the momentum that, until this year, had consistently set it apart from the broader retail sector.

Crédito da imagem: Getty Images