Costco boosts its dividend by 14% while touting sharp rise in e-commerce sales

By Emily Bary

Company says March sales benefited from the timing of Easter

Costco Wholesale Corp. saw a 9.4% sales boost in the five weeks through April 7, driven by a surge in e-commerce activity.

The wholesaler on Wednesday afternoon posted sales numbers for that period, which it calls the retail month of March. That amounted to $23.5 billion, up from $21.5 billion a year before.

E-commerce demand remains a huge driver for Costco (COST), and comparable sales there were up 28.3% for the period. Overall comparable sales for the company grew 7.7%, with the U.S. up 7.3% and international markets above 8%.

Comparable sales for Costco constitute net sales from company warehouses that have been open for over a year, including those that have been remodeled, relocated or expanded. The metric also takes into account e-commerce sales from sites that have been in operation for more than one year.

When factoring out impacts from gasoline sales, Costco booked comparable sales growth of 7.5%.

The company noted in its release that it benefited from the timing of Easter this year, to the tune of about half a percent in impact to its total-sales and comparable-sales performance.

Costco also is boosting its quarterly dividend to $1.16 a share from $1.02 a share, which marks an increase of nearly 14%. That dividend is payable on May 10 to shareholders of record as of the close of business on April 26.

The stock's yield will remain rather low even with the dividend increase. Shares currently yield 0.56% annually and will yield 0.64% annually with the new payout.

The retailer has been the subject of increased attention recently as Wall Street tries to gauge the financial performance of the gold bars that Costco sells. A Wells Fargo analyst recently estimated that the company could be selling $200 million of gold and silver each month, though Costco's latest monthly release contained no mention of gold bars.

See also: Costco's 1-ounce gold bars selling out 'within a few hours'-again

Costco didn't respond to a prior MarketWatch request for comment on its recent gold-bar sales performance.

Don't miss: Gold buyers are holding on to the precious metal as prices break records - and are ready to buy more

-Emily Bary

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04-10-24 1705ET

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