Why Costco Is an Underrated Dividend Stock
Costco Wholesale (NASDAQ: COST) is a solid business to invest in as the big-box retailer seemingly always finds ways to grow -- even amid a global pandemic or when inflation is high. The one feature of the stock that may disappoint investors is its dividend yield. At the current share price, it yields only 0.7%, so you would need to invest a whopping $143,000 to collect just $1,000 in dividend income over the course of a full year.
That payout may look underwhelming, but it really isn't. Here's why Costco's dividend is more impressive than it appears to be.
Yield is a function of both the dividend the company pays and the current stock price. And over the last five years, Costco's share price has risen by 162%. As of the end of January 2018, the retail stock was trading at around $195.
Source Fool.com
