Wal-Mart Stores, Inc. (WMT): Three Reasons to Consider This Big Box Retailer

3. Dividend payout

Wal-Mart is a member of an exclusive Wall Street club for companies that have consistently increased dividends for at least 25 years. Wal-Mart’s current annual dividend is $1.88 per share. This represents a 2.5% yield. Investors who are interested in dividend income should definitely like this.

Another main competitor, Costco Wholesale Corporation (NASDAQ:COST), also pays a dividend but its yield is only 1%, or $1.1 per share.

Costco Wholesale Corporation (NASDAQ:COST) has a different strategy than Wal-Mart Stores, Inc. (NYSE:WMT). Costco sells its actual products at cost or slightly above cost while receiving the bulk of its revenue from membership fees. Earlier this year, Costco increased its membership fees 15%, driving additional income growth.

The company has also witnessed year-over-year sales growth of 7%. Both of these are positive signs for investors in Costco Wholesale Corporation (NASDAQ:COST). Costco also does a much better job of retaining employees and offering higher qualities of customer service.

Final thoughts

Finding a company that pays a high dividend, has excellent earnings growth, and potential is challenging. Wal-Mart Stores, Inc. (NYSE:WMT) certainly fits the bill. It has a strong, profitable brand and has top hedge funds as main investors. If you are looking for a great company in which to invest, Wal-Mart may be the one.

The article 3 Reasons to Consider This Big Box Retailer originally appeared on Fool.com and is written by Austin Higgins.

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