Toro Corp.'s $1.75 Special Dividend Represents Over 33% of Current Share Price

Investors in Toro Corp. (NASDAQ: TORO) are in for a notable payout. The company has just declared a one-time special dividend of $1.75 per share—equivalent to roughly 33.8% of the current trading price of $5.18 as of 09:53 AM. This hefty distribution not only stands out in today’s market but also sets in motion some unique mechanics for shareholders.

Shareholders Can Choose Between Cash or Additional Shares—Here’s How

Toro’s board is giving shareholders a choice: receive the special dividend entirely in cash, or opt to take it all in common shares. The share allocation is determined based on a 20-day volume weighted average price (VWAP) of $3.84, as calculated through December 4, 2025. This gives shareholders flexibility—but also means that the number of shares you receive if you opt for stock will depend on the set VWAP, regardless of where the market price sits when the dividend is paid out on January 16, 2026.

If no election form is returned by January 5, 2026, the default is an all-cash payout. It’s worth noting Toro reserves the right to pay the entire dividend in cash even after elections are received, providing them significant leeway in final distribution.

Due Bill Period Changes the Usual Ex-Dividend Dynamics

Because this special dividend represents more than 25% of Toro’s trading price, Nasdaq has implemented “due bills.” Between December 16, 2025 (record date) and January 16, 2026 (payment date), shares will trade with the right to the dividend attached. Buyers during this period get the dividend in cash, while sellers forfeit the right to receive it. This period runs up to the last trading day before the January 20, 2026 ex-dividend date.

That means anyone looking to capture this dividend should be careful with timing their purchase or sale. During this due bill period, only cash payout is available for shares bought—stock elections are not allowed for those acquiring shares after December 16, 2025.

Taxable Dividend and Shareholder Action Steps

Regardless of payout type, the special dividend is expected to be taxable for shareholders. Those wishing to take their payout in common shares need to return an election form by January 5, 2026. Most investors who do nothing will default to receiving cash. The company will communicate specifics through letters and their transfer agent, so checking your mailbox or contacting your broker is advised.

What Investors Should Watch: Price Action and Flexibility

Such a large special dividend often results in short-term volatility as the market adjusts for the payout. The unique flexibility of Toro’s offer—with a company-set VWAP for share elections and the potential for the company to switch all elections to cash at the last minute—adds an extra wrinkle to the usual process. Investors need to consider the relative value of shares versus cash, potential tax implications, and the possibility that the share price may adjust following the dividend.

While the payout is certainly eye-catching, shareholders should ensure they’re aware of the mechanics, election process, and the due bill implications before making trading decisions. If in doubt, consult your broker or financial advisor—especially during this due bill window, when timing and execution become critical.

Summary Table: Key Dates and Details for TORO Special Dividend

The bottom line: Toro’s $1.75 per share special dividend—representing more than one-third of its market price—offers unusual flexibility and comes with a unique trading period. Shareholders should pay close attention to the timing, mechanics, and possible tax consequences as they make their choices in the coming weeks.

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