Costco highlighted as top American dividend stock with strong growth potential
From Yahoo Finance: 2025-04-21 10:22:00
In a recent report, the top American dividend stocks were listed, with Costco Wholesale Corporation (NASDAQ:COST) being highlighted. Dividend-paying stocks have shown consistent returns, especially during economic uncertainty, prompting more investors to turn to them for compounding potential.
According to S&P Dow Jones Indices, S&P companies paid a record $167.6 billion in dividends in Q4 2024, up 6.7% from the previous quarter. Dividends have historically played a crucial role in driving equity investment returns, with reinvested dividends making up 94% of the total return since 1940.
Costco Wholesale Corporation (NASDAQ:COST) stands out as a strong dividend stock, with a projected upside potential of 9.26% as of April 20. The company, known for its membership-based warehouse club stores, reported revenue growth in Q2 2025 and declared a 12% dividend increase, marking its 21st consecutive year of dividend growth.
Despite COST ranking 10th on the list of the best American dividend stocks, analysts suggest that deeply undervalued dividend stocks may offer greater promise for higher returns in a shorter time frame. The company’s plans for further domestic expansion and strong financial performance position it well for future growth and dividend increases.