Tis’ the Season for Giving – Cash Dividend Bonuses that is…
So I’ve left the DDI Portfolio mostly on auto-pilot over the last few months while I’ve tended to a death in the family, but upon my return I’ve been greeted with some good news!
Just last week I received a Special Dividend from Wynn Resorts (ticker: WYNN) good for $7.50/share! And this week things continued to get better with news that Las Vegas Sands (ticker: LVS) is going to pay a $2.75/share special dividend *and* increase the annual dividend by 40%. WOW.
To top things off, Costco Wholesale (ticker: COST) adds another whopping $7.00 special dividend to the list.
What’s interesting about this special dividend is that even though Costco has approximately $4.6 billion in cash, more than enough to pay out the $3 billion plus dividend, they chose instead to take advantage of the low interest rates available, and have sold bonds to finance the one-time payout. While I would have preferred that they pay a smaller dividend and use the cash on the balance sheet – as a small investor I don’t get a whole lot of say in the matter.
All together these extra payouts are adding up to a nice holiday bonus! You know what, I’ll take it.
While extra dividend payments at the end of the year aren’t all that uncommon, there is a lot of talk about how the pending “Fiscal Cliff” and the possible tax increases that will go with it are encouraging more companies with extra cash on their balance sheets to throw off generous one-time or special dividends.
For those that follow the “Special Dividend” payers, this is the time of year when National Presto (ticker: NPK) has typcially announced their own special dividend, as I wrote about this time last year.
Time For Economic Improvement
With all this extra cash floating around, I’m looking forward to heading into December and the remainder of the holiday season, hopeful that the bonus payouts will continue to be generous. If the President and Congress can reach an agreement on how to manage the pending tax increases before Christmas, it’s likely we’ll get several gifts in our stock portfolios stockings this year:
- Increased Dividend Payouts
- Special Dividends
- Rising Share Prices
Here’s to continued continued success in passive dividend investing!