there`s going to be a lot of sam`s club workers wondering if they can get a job at costco.

Costco is saying that its stockholders can better invest the profits than the company can. In other words instead of using the money to build additional stores and other improvements to the company, they are returning the profits to the stockholders.

Since Costco is a retailer, I got to think they believe that addtional expansion in the retail market is not possible for the foreseeable future.

Another consideration is their belief that the favorable tax treatment of dividends of companies held long term is going to change, and they are advancing these payments in anticipation of the change.

And "take the money and run" (via dividends and share buybacks) has become more or less standard practice:

I thought it was good news at first, but one of the other posters on this thread made a good point, that it would be better if the company kept the money and was able to expand their operations.

For what it's worth, I do hope they let the dividend tax cut expire. That thing was an albatross when it passed.

If they are really worried about double taxation, why not do something about the double taxation of income withheld as payroll tax but included as gross income for income tax purposes. That probably affects more middle class people than dividend tax rates.