2 Potential Catalysts For Costco's Stock In 2022

Costco Wholesale Corporation COST is trading higher Friday after reporting strong financial results. The stock is now up nearly 50% year-to-date and Jim Cramer still thinks there is more upside ahead for the membership-only retail giant. 

"Even though shares of Costco nicely outperformed the broader market this year, these two potential events are reasons to stick with stock in 2022," Cramer said Thursday night in a letter to members of CNBC's "Investing Club."

Special Cash Dividend: He pointed to the potential for the company to issue a special cash dividend in 2022 as a reason to hold onto Costco shares. 

"Costco has a history of paying out a special cash dividend to shareholders," Cramer said. Costco issued special cash dividends to shareholders four times over the past eight years and last issued a dividend in November 2020.

"The strength of their cash flow from operations has put them in a position to reward shareholders again sometime soon," according to Cramer.

See Also: Here's How Much You Would Have Made Owning Costco Wholesale Stock In The Last 5 Years

Membership Fees: He also pointed to a potential membership fee increase as a catalyst for the stock in 2022.

"Historically Costco increases the cost of a membership every five years, and it will be five years next summer," Cramer said.

He believes Costco can increase its membership fee next year with minimal resistance from existing customers.

Cramer noted that revenue from membership fees is "pure profit" for Costco.

COST Price Action: Costco has traded as high as $560.78 and as low as $307 over a 52-week period.

The stock was up 5.67% at $554.04 at time of publication Friday.

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