In the financial pages today, is a story about Costco paying a special dividend. If you are a shareholder, you will be getting extra money. Special dividends are awarded after the Board has examined many opportunities and decided the best use of the cash is to give the money to the shareholder. The reasons for having the extra money is varied  and can include: a sale of a division as the company restructures into core holdings; changes in government regulations which encourage one time events before the regulation is effective; the margins in selling product were much higher for example in commodity prises rose more than what is termed normal; and other reasons come into play.

Dividends by their nature go to shareholders, the Board is well aware of who or what institutions are the biggest shareholders. Does having a special dividend payout increase the insiders accounts, yes. The difference between enriching the shareholders and giving a larger payment to employees is anyone can own shares and shares imply an ownership in the company. The writer’s bias is the Board is doing the right thing.

There are more questions than answers, till the next time – to raising questions.