Costco Wholesale (COST)
Market Price (10/8/2026): $0 | Market Cap: $-Investor Relations Sector: Consumer Staples | Industry: Consumer Staples Merchandise Retail
Costco Wholesale (COST)
Market Price (10/8/2026): $0Market Cap: $-Sector: Consumer StaplesIndustry: Consumer Staples Merchandise Retail
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
Strong revenue growthRev Chg LTMRevenue Change % Last Twelve Months (LTM) is 10% Stock buyback supportStock Buyback 3Y Total is 2.5 Bil Attractive cash flow generationCFO LTM is 16 Bil, FCF LTM is 9.4 Bil Low stock price volatilityVol 12M is 20% Megatrend and thematic driversMegatrends include E-commerce & Digital Retail, Experience Economy & Premiumization, Automation & Robotics, Health & Wellness Trends, Show more. | Weak multi-year price returns2Y Excs Rtn is -28%, 3Y Excs Rtn is -10% | Expensive valuation multiplesP/EBITPrice/EBIT or Price/(Operating Income) ratio is 34x, P/CFOPrice/(Cash Flow from Operations). CFO is cash before capital expenditures. is 26x, P/EPrice/Earnings or Price/(Net Income) is 45x Yield minus risk free rate is negativeERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is -2.5% Key risksCOST key risks include [1] a heavy dependence on membership fee income for profitability and [2] global supply chain disruptions that threaten its low-price value proposition. |
| Strong revenue growthRev Chg LTMRevenue Change % Last Twelve Months (LTM) is 10% |
| Stock buyback supportStock Buyback 3Y Total is 2.5 Bil |
| Attractive cash flow generationCFO LTM is 16 Bil, FCF LTM is 9.4 Bil |
| Low stock price volatilityVol 12M is 20% |
| Megatrend and thematic driversMegatrends include E-commerce & Digital Retail, Experience Economy & Premiumization, Automation & Robotics, Health & Wellness Trends, Show more. |
| Weak multi-year price returns2Y Excs Rtn is -28%, 3Y Excs Rtn is -10% |
| Expensive valuation multiplesP/EBITPrice/EBIT or Price/(Operating Income) ratio is 34x, P/CFOPrice/(Cash Flow from Operations). CFO is cash before capital expenditures. is 26x, P/EPrice/Earnings or Price/(Net Income) is 45x |
| Yield minus risk free rate is negativeERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is -2.5% |
| Key risksCOST key risks include [1] a heavy dependence on membership fee income for profitability and [2] global supply chain disruptions that threaten its low-price value proposition. |
Qualitative Assessment
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Costco Wholesale (COST) stock has remained largely at the same level since 6/30/2026 because of the following key factors:
1. Strong Fiscal Q4 2026 Performance Offset by Valuation Concerns.
Costco reported robust operating results for its fiscal fourth quarter 2026, which ended on August 30, 2026, exceeding analyst expectations. The company posted diluted earnings per share (EPS) of $6.75, surpassing consensus estimates of $6.52, and revenue of $95.7 billion, ahead of estimates between $94.86 billion and $94.97 billion. Net sales for the quarter increased by 11.2% to $93.9 billion, with comparable sales rising 9.4% (or 6.7% when adjusted for gasoline prices and foreign exchange). However, the reported EPS included a non-recurring $0.15 per diluted share benefit from tariff refunds; adjusted EPS was $6.60. Despite this strong performance, the stock's high valuation, trading at over 44 times trailing earnings, led some analysts to trim price targets, resulting in a muted post-earnings stock reaction and limiting further upside.
2. Sustained Membership Growth and Strategic Reinvestment in Member Value.
Costco continued to demonstrate healthy membership engagement during fiscal Q4 2026, with membership fee income growing 7.3% to $1.850 billion. Total paid members increased 3.8% year-over-year to 84.1 million, while higher-tier Executive members saw a 9.4% increase, reaching 42.3 million. The company's worldwide renewal rate improved to 89.8%, with the U.S. and Canada renewal rate hitting 92.3%. Costco also strategically reinvested a significant portion of tariff refunds, amounting to $184 million in fiscal Q4 2026 and a similar amount in fiscal Q1 2027, into lowering prices for members across various categories, reinforcing its value proposition and loyalty.
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Costco Wholesale (COST) stock has remained largely at the same level since 6/30/2026 because of the following key factors:
1. Strong Fiscal Q4 2026 Performance Offset by Valuation Concerns.
Costco reported robust operating results for its fiscal fourth quarter 2026, which ended on August 30, 2026, exceeding analyst expectations. The company posted diluted earnings per share (EPS) of $6.75, surpassing consensus estimates of $6.52, and revenue of $95.7 billion, ahead of estimates between $94.86 billion and $94.97 billion. Net sales for the quarter increased by 11.2% to $93.9 billion, with comparable sales rising 9.4% (or 6.7% when adjusted for gasoline prices and foreign exchange). However, the reported EPS included a non-recurring $0.15 per diluted share benefit from tariff refunds; adjusted EPS was $6.60. Despite this strong performance, the stock's high valuation, trading at over 44 times trailing earnings, led some analysts to trim price targets, resulting in a muted post-earnings stock reaction and limiting further upside.
2. Sustained Membership Growth and Strategic Reinvestment in Member Value.
Costco continued to demonstrate healthy membership engagement during fiscal Q4 2026, with membership fee income growing 7.3% to $1.850 billion. Total paid members increased 3.8% year-over-year to 84.1 million, while higher-tier Executive members saw a 9.4% increase, reaching 42.3 million. The company's worldwide renewal rate improved to 89.8%, with the U.S. and Canada renewal rate hitting 92.3%. Costco also strategically reinvested a significant portion of tariff refunds, amounting to $184 million in fiscal Q4 2026 and a similar amount in fiscal Q1 2027, into lowering prices for members across various categories, reinforcing its value proposition and loyalty.
3. Robust Digital Sales and Ambitious Warehouse Expansion Plans.
Costco showed strong progress in its e-commerce business, with digitally-enabled sales growing 19.5% in fiscal Q4 2026 (19.8% adjusted for currency changes) and exceeding $33 billion for the full fiscal year 2026. To further enhance convenience and attract younger demographics, Costco expanded its Uber Eats delivery partnership to 47 states, covering nearly 600 warehouses. The company also plans significant physical expansion, intending to open 33 new warehouses in fiscal year 2027, an increase from 28 opened in fiscal 2026. This expansion strategy, however, is projected to increase capital expenditures to approximately $7.5 billion in fiscal 2027 from $6.4 billion in fiscal 2026.
4. Headwinds from Fading Membership Fee Hike Benefits and Macroeconomic Factors.
Fiscal Q4 2026 marked the final quarter to benefit from the year-over-year impact of the membership fee increase implemented in September 2024, meaning future fee growth will primarily rely on new member acquisitions and Executive upgrades. Additionally, the company is navigating broader macroeconomic headwinds, including increasing non-food inflation, particularly in memory costs and petroleum-related items, and ongoing uncertainties surrounding future tariff dynamics. While overall consumer demand has remained strong, a noted deceleration in membership household growth over eight consecutive quarters presents a potential challenge.
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Stock Movement Drivers
Fundamental Drivers
The 0.9% change in COST stock from 6/30/2026 to 10/7/2026 was primarily driven by a 3.3% change in the company's Total Revenues ($ Mil).| (LTM values as of) | 6302026 | 10072026 | Change |
|---|---|---|---|
| Stock Price ($) | 933.99 | 942.25 | 0.9% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 293,587 | 303,154 | 3.3% |
| Net Income Margin (%) | 3.0% | 3.0% | 1.1% |
| P/E Multiple | 46.9 | 45.3 | -3.3% |
| Shares Outstanding (Mil) | 444 | 444 | 0.0% |
| Cumulative Contribution | 0.9% |
Market Drivers
6/30/2026 to 10/7/2026| Return | Correlation | |
|---|---|---|
| COST | 0.9% | |
| Market (SPY) | 4.1% | -10.7% |
| Sector (XLP) | -1.6% | 74.6% |
Fundamental Drivers
The -5.1% change in COST stock from 3/31/2026 to 10/7/2026 was primarily driven by a -12.1% change in the company's P/E Multiple.| (LTM values as of) | 3312026 | 10072026 | Change |
|---|---|---|---|
| Stock Price ($) | 993.41 | 942.25 | -5.1% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 286,265 | 303,154 | 5.9% |
| Net Income Margin (%) | 3.0% | 3.0% | 1.9% |
| P/E Multiple | 51.6 | 45.3 | -12.1% |
| Shares Outstanding (Mil) | 444 | 444 | 0.0% |
| Cumulative Contribution | -5.1% |
Market Drivers
3/31/2026 to 10/7/2026| Return | Correlation | |
|---|---|---|
| COST | -5.1% | |
| Market (SPY) | 19.8% | -14.3% |
| Sector (XLP) | 0.4% | 70.3% |
Fundamental Drivers
The 2.4% change in COST stock from 9/30/2025 to 10/7/2026 was primarily driven by a 12.8% change in the company's Total Revenues ($ Mil).| (LTM values as of) | 9302025 | 10072026 | Change |
|---|---|---|---|
| Stock Price ($) | 920.26 | 942.25 | 2.4% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 268,776 | 303,154 | 12.8% |
| Net Income Margin (%) | 2.9% | 3.0% | 4.3% |
| P/E Multiple | 52.1 | 45.3 | -13.0% |
| Shares Outstanding (Mil) | 444 | 444 | 0.0% |
| Cumulative Contribution | 2.4% |
Market Drivers
9/30/2025 to 10/7/2026| Return | Correlation | |
|---|---|---|
| COST | 2.4% | |
| Market (SPY) | 17.6% | -7.0% |
| Sector (XLP) | 6.4% | 61.9% |
Fundamental Drivers
The 73.5% change in COST stock from 9/30/2023 to 10/7/2026 was primarily driven by a 28.8% change in the company's Total Revenues ($ Mil).| (LTM values as of) | 9302023 | 10072026 | Change |
|---|---|---|---|
| Stock Price ($) | 542.94 | 942.25 | 73.5% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 235,442 | 303,154 | 28.8% |
| Net Income Margin (%) | 2.5% | 3.0% | 19.4% |
| P/E Multiple | 40.2 | 45.3 | 12.9% |
| Shares Outstanding (Mil) | 444 | 444 | 0.0% |
| Cumulative Contribution | 73.5% |
Market Drivers
9/30/2023 to 10/7/2026| Return | Correlation | |
|---|---|---|
| COST | 73.5% | |
| Market (SPY) | 88.1% | 33.3% |
| Sector (XLP) | 28.0% | 56.9% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| COST Return | 52% | -19% | 49% | 40% | -5% | 9% | 164% |
| Peers Return | 28% | -21% | 22% | 34% | 0% | 10% | 82% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | 14% | 108% |
Monthly Win Rates [3] | |||||||
| COST Win Rate | 75% | 50% | 75% | 50% | 50% | 50% | |
| Peers Win Rate | 65% | 40% | 62% | 68% | 50% | 52% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 50% | |
Max Drawdowns [4] | |||||||
| COST Max Drawdown | -18% | -31% | -10% | -10% | -21% | -18% | |
| Peers Max Drawdown | -16% | -37% | -20% | -17% | -26% | -21% | |
| S&P 500 Max Drawdown | -5% | -25% | -10% | -8% | -19% | -9% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: WMT, AMZN, TGT, HD, KR. See COST Returns vs. Peers.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 10/7/2026 (YTD)
How Low Can It Go
| Event | COST | S&P 500 |
|---|---|---|
| 2025 US Tariff Shock | ||
| % Loss | -16.2% | -18.8% |
| % Gain to Breakeven | 19.3% | 23.1% |
| Time to Breakeven | 431 days | 79 days |
| 2022 Inflation Shock & Fed Tightening | ||
| % Loss | -26.3% | -24.5% |
| % Gain to Breakeven | 35.7% | 32.4% |
| Time to Breakeven | 430 days | 427 days |
| 2020 COVID-19 Crash | ||
| % Loss | -13.4% | -33.7% |
| % Gain to Breakeven | 15.4% | 50.9% |
| Time to Breakeven | 119 days | 140 days |
| Q4 2018 Fed Policy Error / Growth Scare | ||
| % Loss | -18.3% | -19.2% |
| % Gain to Breakeven | 22.5% | 23.8% |
| Time to Breakeven | 78 days | 105 days |
| 2011 US Debt Ceiling Crisis & European Contagion | ||
| % Loss | -13.5% | -17.9% |
| % Gain to Breakeven | 15.7% | 21.8% |
| Time to Breakeven | 35 days | 123 days |
| 2010 Eurozone Sovereign Debt Crisis / Flash Crash | ||
| % Loss | -10.4% | -15.4% |
| % Gain to Breakeven | 11.7% | 18.2% |
| Time to Breakeven | 54 days | 125 days |
In The Past
Costco Wholesale's stock fell -16.2% during the 2025 US Tariff Shock. Such a loss loss requires a 19.3% gain to breakeven.
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| Event | COST | S&P 500 |
|---|---|---|
| 2022 Inflation Shock & Fed Tightening | ||
| % Loss | -26.3% | -24.5% |
| % Gain to Breakeven | 35.7% | 32.4% |
| Time to Breakeven | 430 days | 427 days |
| 2008-2009 Global Financial Crisis | ||
| % Loss | -44.8% | -53.4% |
| % Gain to Breakeven | 81.2% | 114.4% |
| Time to Breakeven | 632 days | 1085 days |
In The Past
Costco Wholesale's stock fell -16.2% during the 2025 US Tariff Shock. Such a loss loss requires a 19.3% gain to breakeven.
Preserve Wealth
Limiting losses and compounding gains is essential to preserving wealth.
Asset Allocation
Actively managed asset allocation strategies protect wealth. Learn more.
About Costco Wholesale (COST)
Costco Wholesale Corporation (COST) operates as a leading global membership-based warehouse club. The company's fundamental business model involves customers paying an annual membership fee to gain exclusive access to a wide assortment of products and services, often offered in bulk or larger package sizes at competitive prices. This membership system is key to its operations, generating a significant portion of its profits from these fees while providing value to its loyal customer base.
Costco offers an extensive array of merchandise, encompassing everything from fresh produce, meats, bakery items, and dry groceries to electronics, home furnishings, apparel, health and beauty products, and automotive supplies including tires. Beyond its diverse product offerings, the company provides various in-warehouse services such as pharmacies, optical centers, food courts, hearing-aid centers, and gas stations. Costco also extends its reach through e-commerce websites and additional services like business delivery and travel packages, serving a broad international market that includes North America, Asia, Europe, and Australia.
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- Walmart for bulk shoppers, with a membership.
- A physical Amazon, but for bulk-discounted goods with a membership.
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- Branded & Private-Label Merchandise: Costco offers a vast array of products, including groceries (fresh, dry, frozen), sundries, appliances, electronics, apparel, home goods, hardware, health & beauty aids, and more, available under various brands and its own Kirkland Signature label.
- Membership-Based Retail Access: The core service is providing exclusive access to a curated selection of products at wholesale prices through its membership warehouse clubs.
- Specialty Health & Wellness Services: This category includes operating on-site pharmacies, optical centers, and hearing-aid centers that provide prescriptions, eye exams, eyeglasses, contact lenses, hearing tests, and hearing aids.
- Automotive & Fuel Services: Costco provides tire installation and maintenance services at its tire centers, alongside selling fuel through numerous gas stations.
- Food Court Services: On-site food courts offer prepared meals, snacks, and beverages for members to enjoy while shopping.
- Online Shopping & Delivery: The company operates e-commerce websites and provides various delivery services, including business delivery and same-day grocery delivery.
- Travel Services: Costco offers members the ability to book travel packages, cruises, rental cars, and hotels through its travel services.
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Costco Wholesale (COST) primarily sells to individuals and small businesses rather than other large public companies. The company operates a membership-based model, with its major customers falling into the following categories:
Individual/Household Members: These are the vast majority of Costco's customers, comprising individuals and families who purchase a wide range of products for personal, family, or household consumption. They pay an annual membership fee to access Costco's warehouses and online offerings.
Small Business Members: Costco also caters to small business owners and operators who purchase items in bulk for their commercial needs. This includes products for office supplies, restaurants, resale, or other operational requirements. Costco offers specific business memberships and services like business delivery to support this customer segment.
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Ron Vachris, CEO & President
Ron Vachris assumed the role of CEO of Costco Wholesale Corporation in January 2024. He began his career at Price Club, which later merged with Costco, as a forklift driver in 1982 while studying business at Glendale Community College. Vachris steadily rose through the ranks, serving in various management positions, including senior vice president and general manager, senior vice president of real estate development, and executive vice president of merchandising, before becoming president and chief operating officer in February 2022. He is recognized for reinforcing Costco's tradition of internal advancement and operational rigor.
Gary Millerchip, Executive Vice President & CFO
Gary Millerchip became Costco's Chief Financial Officer in March 2024. Prior to joining Costco, he served as Senior Vice President and CFO at The Kroger Co. from 2019 to 2024, where he led finance and strategy. Millerchip also brings over 20 years of experience in banking, most recently with NatWest Group (formerly Royal Bank of Scotland) in the UK.
Claudine Adamo, Executive Vice President & COO, Merchandising
Claudine Adamo has served as Costco's COO of Merchandising since February 2022. She has spent her entire career of over 30 years at Costco, having advanced from hourly roles to leadership positions in buying, merchandising, and e-commerce.
Torsten Lubach, CTO
Torsten Lubach has served as Costco's Chief Technology Officer since June 2020. In this role, he leads the company's digital and IT modernization, overseeing e-commerce modernization, automation, and global optimization of processes. Lubach's previous experience includes senior IT and digital leadership positions at Lidl in the US and Europe.
Russ Miller, Senior Executive Vice President & COO, Warehouse Operations, U.S. and Mexico
Russ Miller holds the position of Senior Executive Vice President and Chief Operating Officer for Warehouse Operations in the U.S. and Mexico.
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Here are the key risks to Costco Wholesale's business:
- Economic Sensitivity and Inflationary Pressures: Costco operates on intentionally thin margins for its merchandise, making it highly susceptible to economic fluctuations, including inflation, rising energy costs, and supply chain disruptions. These factors can significantly increase merchandising and operational costs, squeezing profitability if not effectively managed or passed on to consumers, which could then impact sales volume. Geopolitical tensions can also escalate trade wars and tariffs, leading to increased import costs and further impacting margins.
- Membership Model Dependence and Potential Saturation: A significant portion of Costco's operating income is derived from its membership fees, which provide a predictable and high-margin revenue stream. A key risk is the potential for membership saturation, particularly in mature markets like the U.S. and Canada, and any decline in membership renewal rates, especially among newer, digitally acquired members. A weakening in membership growth or loyalty could directly impact this crucial profit driver.
- Intense Competition and E-commerce Challenges: The retail industry is characterized by fierce competition from a variety of players, including other warehouse clubs such as Sam's Club and BJ's Wholesale Club, traditional general merchandise retailers like Target and Kroger, and formidable e-commerce platforms like Amazon. Costco faces the ongoing challenge of adapting its e-commerce capabilities to meet evolving consumer preferences for digital convenience without undermining its core warehouse shopping experience. The company's conservative expansion into member-related services compared to competitors' lucrative ecosystems could also pose a long-term disadvantage.
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Costco Wholesale Corporation (symbol: COST) operates across various product and service categories. Here are the addressable market sizes for its main offerings:
- Grocery Market (Food & Sundries, Fresh Foods):
- Global: The global food and grocery retail market was valued at approximately USD 12.36 trillion in 2024.
- Consumer Electronics:
- Global: The global consumer electronics market size was valued at USD 949.7 billion in 2024.
- U.S.: The U.S. consumer electronics market was valued at approximately USD 185.8 billion in 2024.
- Apparel:
- Global: The global apparel market size was valued at USD 1.8 trillion in 2024.
- U.S.: The United States apparel market is projected to reach US$360 billion in 2024. Online apparel sales in the U.S. reached $111 billion in 2024.
- Pharmacies (including Health and Beauty Aids):
- Global: The global pharmacy market size was estimated at USD 1.35 trillion in 2024.
- U.S.: The U.S. pharmacy market size was estimated at USD 732.44 billion in 2024.
- Gas Stations (Gasoline):
- Global: The global gasoline market size was valued at USD 132.67 billion in 2024.
- Tire Installation Centers (Tire Retail):
- Global: The global tire retail market size was USD 221.6 billion in 2024.
- E-commerce (for business delivery, same-day grocery, and various other online services):
- Global: The global e-commerce market is expected to total $6.3 trillion in 2024.
- U.S.: Total U.S. e-commerce sales reached $1.19 trillion in 2024.
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Costco Wholesale Corporation (COST) is anticipated to drive future revenue growth over the next 2-3 years through several key strategies:
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Expansion of Warehouse Footprint: Costco is committed to aggressive physical expansion, with plans to open approximately 30-35 new warehouses annually. The company opened 27 new warehouses in fiscal year 2025 and aims for another 35 in fiscal year 2026. This expansion includes both domestic and international markets, utilizing innovative real estate approaches such as multi-story warehouses and mixed-use developments to penetrate urban areas previously considered out of reach.
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Growth in Membership and Fee Income: A significant driver of revenue is the steady increase in paid memberships and associated fee income. Membership fee income grew by 14% year-over-year in both Q4 2025 and Q1 2026, fueled by new member sign-ups and a strong increase in Executive memberships. As of Q2 2026, Costco reported 82.1 million paid members, a 4.8% increase from the prior year, with Executive memberships growing by 9.5% to 40.4 million. Analysts consistently highlight strong membership growth as a core strength.
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Enhancement of E-commerce and Digital Capabilities: Costco is making strategic investments in its digital presence and capabilities. E-commerce sales increased over 15% in fiscal year 2025, exceeding $19.6 billion. Digitally enabled comparable sales surged by 20.5% in Q1 2026 and 22.6% in Q2 2026, supported by substantial growth in e-commerce site traffic and app visits. The company is also implementing personalization capabilities for product recommendations and improving in-warehouse technology to enhance the member experience.
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Increased Traffic and Average Transaction Size: Initiatives aimed at improving the shopping experience and offering competitive pricing are driving higher store traffic and increasing the average transaction size. Worldwide traffic increased by 3.1% and the average transaction was up 3.2% in Q1 2026. Price reductions on essential items have contributed to traffic growth, while "meaningful improvements in the speed of checkout" and targeted upgrades in the member experience support both sales and productivity.
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Effective Pricing Strategies and Private Label Growth: Costco's disciplined approach to maintaining low prices and leveraging its Kirkland Signature private label continues to attract and retain members. The Kirkland Signature brand consistently grows in sales penetration, offering high-quality value to members. Analysts emphasize Costco's effective pricing strategies and its philosophy of reinvesting in price as key factors enabling sustained market share gains and long-term earnings growth.
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Capital Allocation Decisions of Costco Wholesale (COST) over the Last 3-5 Years
Share Repurchases
- Costco engaged in significant share repurchases, totaling $903 million in fiscal year 2025.
- The company repurchased $700 million in fiscal year 2024 and $676 million in fiscal year 2023.
- In the second quarter of fiscal year 2026, Costco executed $420 million in share buybacks.
Share Issuance
- No significant share issuances with dollar amounts were identified for Costco Wholesale over the last 3-5 years.
Inbound Investments
- No significant inbound investments by third-parties in Costco Wholesale were identified over the last 3-5 years.
Outbound Investments
- No significant strategic outbound investments made by Costco Wholesale in other companies were identified over the last 3-5 years.
Capital Expenditures
- Capital expenditures for Costco have shown a consistent increase, with $5,498 million in fiscal year 2025, $4,710 million in fiscal year 2024, and $4,323 million in fiscal year 2023.
- Costco intends to spend approximately $6,000 million to $6,500 million on capital expenditures during fiscal year 2026.
- The primary focus of these expenditures is on acquiring land, buildings, and equipment for new and remodeled warehouses, information systems, manufacturing and distribution facilities, as well as expanding the global footprint with plans for 28 net new warehouses in fiscal year 2026 and over 30 annually in subsequent years.
Peer Outperformance in Consumer Staples Merchandise Retail
| Ticker | Name | Rev Growth 3Y Avg | P/E | 1Y | 3Y | 5Y | 5Y Gap |
|---|---|---|---|---|---|---|---|
| COST | Costco Wholesale | 7.8% | 45.3x | 3.6% | 75.9% | 120.0% | — |
| WMT | Walmart | 5.3% | 39.0x | 5.6% | 114.1% | 147.3% | +27pp |
| Industry | Names | 1Y med | 3Y med | 5Y med | Top 3 by 5Y |
|---|---|---|---|---|---|
| Consumer Staples Merchandise Retail ← | 12 | 8.7% | 40.3% | 58.5% | NGVC 215% · WMT 147% · VLGEA 137% |
| Food Retail | 6 | -9.4% | 54.0% | 29.7% | CASY 242% · SFM 192% · KR 67% |
| Tobacco | 6 | -37.4% | 9.1% | 20.1% | PM 154% · MO 118% · TPB 24% |
| Food Distributors | 9 | -1.2% | 32.5% | 5.3% | CHEF 224% · USFD 152% · ANDE 125% |
| Soft Drinks & Non-alcoholic Beverages | 12 | -10.0% | -14.0% | -3.6% | COKE 386% · CCHGY 111% · BRFH 101% |
| Brewers | 3 | -16.4% | -30.5% | -6.8% | BUD 46% · TAP -7% · SAM -69% |
| Household Products | 19 | 0.9% | -8.1% | -14.6% | ACU 107% · IPAR 61% · CL 30% |
| Agricultural Products & Services | 11 | -18.8% | -3.2% | -17.4% | ADM 48% · BG 43% · ALCO 19% |
| Personal Care Products | 4 | -0.2% | -0.9% | -23.1% | ELF 254% · PG 19% · COTY -65% |
| Packaged Foods & Meats | 48 | -31.4% | -37.2% | -43.0% | MAMA 443% · LWAY 288% · SENEA 223% |
| Distillers & Vintners | 5 | -46.9% | -59.1% | -80.0% | STZ -41% · BF-B -57% · MGPI -80% |
| Drug Retail | 3 | -24.2% | -37.9% | -94.2% | HITI -54% · SCNX -94% · PETS -95% |
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Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 204.53 |
| Mkt Cap | 350.2 |
| Rev LTM | 236,165 |
| Op Inc LTM | 16,354 |
| FCF LTM | 6,919 |
| FCF 3Y Avg | 10,516 |
| CFO LTM | 17,298 |
| CFO 3Y Avg | 16,169 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 4.3% |
| Rev Chg 3Y Avg | 4.2% |
| Rev Chg Q | 5.8% |
| QoQ Delta Rev Chg LTM | 1.5% |
| Op Inc Chg LTM | 11.2% |
| Op Inc Chg 3Y Avg | 11.4% |
| Op Mgn LTM | 5.0% |
| Op Mgn 3Y Avg | 4.9% |
| QoQ Delta Op Mgn LTM | 0.1% |
| CFO/Rev LTM | 7.0% |
| CFO/Rev 3Y Avg | 6.4% |
| FCF/Rev LTM | 2.5% |
| FCF/Rev 3Y Avg | 2.8% |
Valuation
| Median | |
|---|---|
| Name | |
| Mkt Cap | 350.2 |
| P/S | 1.3 |
| P/Op Inc | 21.9 |
| P/EBIT | 16.7 |
| P/E | 26.8 |
| P/CFO | 16.1 |
| Total Yield | 5.2% |
| Dividend Yield | 1.7% |
| FCF Yield 3Y Avg | 3.2% |
| D/E | 0.2 |
| Net D/E | 0.1 |
Returns
| Median | |
|---|---|
| Name | |
| 1M Rtn | 0.5% |
| 3M Rtn | -0.2% |
| 6M Rtn | -11.3% |
| 12M Rtn | 4.7% |
| 3Y Rtn | 68.1% |
| 1M Excs Rtn | -0.3% |
| 3M Excs Rtn | -1.9% |
| 6M Excs Rtn | -26.3% |
| 12M Excs Rtn | -10.5% |
| 3Y Excs Rtn | -17.2% |
Comparison Analyses
Segment Financials
Revenue by Segment| $ Mil | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Operation of membership warehouses | 275,235 | 254,453 | 242,290 | 226,954 | 195,929 |
| Total | 275,235 | 254,453 | 242,290 | 226,954 | 195,929 |
| $ Mil | 2012 | 2011 | 2010 | 2009 | 2004 |
|---|---|---|---|---|---|
| United States Operations | 1,632 | 1,395 | 1,310 | 1,121 | |
| Canadian Operations | 668 | 621 | 547 | 215 | |
| Other International Operations | 459 | 423 | 220 | 150 | 50 |
| Canada | 354 | ||||
| United States | 1,273 | ||||
| Total | 2,759 | 2,439 | 2,077 | 1,777 | 1,386 |
| $ Mil | 2012 | 2011 | 2010 | 2009 | 2004 |
|---|---|---|---|---|---|
| United States Operations | 18,401 | 18,558 | 18,247 | 12,108 | |
| Other International Operations | 4,502 | 4,462 | 2,421 | 2,110 | 1,267 |
| Canadian Operations | 4,237 | 3,741 | 3,147 | 1,718 | |
| Canada | 2,641 | ||||
| United States | 17,228 | ||||
| Total | 27,140 | 26,761 | 23,815 | 21,979 | 15,093 |
Price Behavior
| Market Price | $942.25 | |
| Market Cap ($ Bil) | 418.3 | |
| First Trading Date | 07/09/1986 | |
| Distance from 52W High | -13.8% | |
| 50 Days | 200 Days | |
| DMA Price | $932.09 | $960.59 |
| DMA Trend | indeterminate | down |
| Distance from DMA | 1.1% | -1.9% |
| 3M | 1YR | |
| Volatility | 19.7% | 20.0% |
| Downside Capture | 3.87 | -16.40 |
| Upside Capture | -1.99 | -9.26 |
| Correlation (SPY) | -10.6% | -6.7% |
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | 0.35 | 0.20 | -0.25 | -0.25 | -0.11 | 0.44 |
| Up Beta | -0.45 | -0.03 | -0.82 | -0.09 | -0.07 | 0.53 |
| Down Beta | -0.44 | 0.94 | 0.06 | -0.03 | -0.07 | 0.45 |
| Up Capture | 35% | 4% | -16% | -29% | -8% | 16% |
| Bmk +ve Days | 6 | 16 | 27 | 66 | 132 | 424 |
| Stock +ve Days | 10 | 19 | 28 | 60 | 119 | 390 |
| Down Capture | 90% | 51% | -5% | -42% | -23% | 58% |
| Bmk -ve Days | 16 | 26 | 37 | 60 | 120 | 328 |
| Stock -ve Days | 12 | 23 | 36 | 66 | 132 | 361 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with COST | |
|---|---|---|---|---|
| COST | 4.1% | 19.9% | 0.08 | - |
| Sector ETF (XLP) | 7.7% | 14.5% | 0.28 | 61.9% |
| Equity (SPY) | 16.8% | 13.0% | 0.92 | -6.8% |
| Gold (GLD) | 3.2% | 29.5% | 0.11 | -6.1% |
| Commodities (DBC) | 44.6% | 20.9% | 1.66 | 0.6% |
| Real Estate (VNQ) | 1.6% | 13.7% | -0.13 | 22.8% |
| Bitcoin (BTCUSD) | -31.7% | 44.2% | -0.73 | -3.9% |
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Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with COST | |
|---|---|---|---|---|
| COST | 17.1% | 22.9% | 0.64 | - |
| Sector ETF (XLP) | 5.7% | 13.7% | 0.20 | 62.9% |
| Equity (SPY) | 13.8% | 17.1% | 0.62 | 51.1% |
| Gold (GLD) | 18.4% | 18.9% | 0.79 | 3.7% |
| Commodities (DBC) | 10.3% | 19.6% | 0.40 | 5.7% |
| Real Estate (VNQ) | 0.8% | 18.8% | -0.07 | 41.2% |
| Bitcoin (BTCUSD) | 15.5% | 52.2% | 0.46 | 19.0% |
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Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with COST | |
|---|---|---|---|---|
| COST | 22.2% | 22.0% | 0.89 | - |
| Sector ETF (XLP) | 7.2% | 14.9% | 0.35 | 63.8% |
| Equity (SPY) | 15.5% | 17.9% | 0.73 | 54.9% |
| Gold (GLD) | 11.5% | 16.4% | 0.57 | 5.8% |
| Commodities (DBC) | 8.4% | 18.1% | 0.38 | 11.9% |
| Real Estate (VNQ) | 4.2% | 20.7% | 0.16 | 41.5% |
| Bitcoin (BTCUSD) | 64.0% | 66.2% | 1.04 | 13.5% |
Smart multi-asset allocation framework can stack odds in your favor. Learn How
Returns Analyses
Earnings Returns History
Updated 10/5/2026| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 9/24/2026 | 2.9% | 2.1% | |
| 5/28/2026 | -3.9% | -2.3% | -4.9% |
| 3/5/2026 | 1.6% | 2.1% | 3.7% |
| 12/11/2025 | -0.0% | -3.0% | 6.5% |
| 9/25/2025 | -2.9% | -2.8% | -1.2% |
| 5/29/2025 | 3.1% | 0.2% | -1.9% |
| 3/6/2025 | -6.1% | -13.2% | -10.7% |
| 12/12/2024 | 0.1% | -3.4% | -6.6% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 15 | 13 | 13 |
| # Negative | 9 | 11 | 10 |
| Median Positive | 1.9% | 2.2% | 6.5% |
| Median Negative | -2.4% | -2.9% | -2.1% |
| Max Positive | 6.6% | 5.5% | 13.1% |
| Max Negative | -7.6% | -13.2% | -10.7% |
| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 9/24/2026 | 2.9% | 2.1% | |
| 5/28/2026 | -3.9% | -2.3% | -4.9% |
| 3/5/2026 | 1.6% | 2.1% | 3.7% |
| 12/11/2025 | -0.0% | -3.0% | 6.5% |
| 9/25/2025 | -2.9% | -2.8% | -1.2% |
| 5/29/2025 | 3.1% | 0.2% | -1.9% |
| 3/6/2025 | -6.1% | -13.2% | -10.7% |
| 12/12/2024 | 0.1% | -3.4% | -6.6% |
| 9/26/2024 | -1.8% | -2.9% | -1.1% |
| 5/30/2024 | -0.7% | 3.3% | 3.7% |
| 3/7/2024 | -7.6% | -6.8% | -9.4% |
| 12/14/2023 | 4.4% | 5.5% | 10.9% |
| 9/26/2023 | 1.9% | 2.2% | -0.5% |
| 5/25/2023 | 4.3% | 5.4% | 9.0% |
| 3/3/2023 | 1.6% | -0.9% | 4.6% |
| 12/9/2022 | 1.0% | -4.5% | 0.3% |
| 9/23/2022 | 3.0% | 1.3% | 6.6% |
| 5/26/2022 | 1.2% | 2.4% | 0.8% |
| 3/4/2022 | 0.6% | 0.4% | 9.4% |
| 12/9/2021 | 6.6% | 5.4% | -1.1% |
| 9/23/2021 | 3.3% | -0.8% | 6.5% |
| 5/27/2021 | -2.4% | 0.0% | 2.3% |
| 3/4/2021 | -0.5% | 3.0% | 13.1% |
| 12/10/2020 | 0.6% | -0.7% | -2.3% |
| SUMMARY STATS | |||
| # Positive | 15 | 13 | 13 |
| # Negative | 9 | 11 | 10 |
| Median Positive | 1.9% | 2.2% | 6.5% |
| Median Negative | -2.4% | -2.9% | -2.1% |
| Max Positive | 6.6% | 5.5% | 13.1% |
| Max Negative | -7.6% | -13.2% | -10.7% |
SEC Filings
Expand for More| Report Date | Filing Date | Filing |
|---|---|---|
| 08/31/2026 | 10/07/2026 | 10-K |
| 05/31/2026 | 06/03/2026 | 10-Q |
| 02/28/2026 | 03/11/2026 | 10-Q |
| 11/30/2025 | 12/17/2025 | 10-Q |
| 08/31/2025 | 10/08/2025 | 10-K |
| 05/31/2025 | 06/05/2025 | 10-Q |
| 02/28/2025 | 03/13/2025 | 10-Q |
| 11/30/2024 | 12/19/2024 | 10-Q |
| 08/31/2024 | 10/09/2024 | 10-K |
| 05/31/2024 | 06/06/2024 | 10-Q |
| 02/29/2024 | 03/13/2024 | 10-Q |
| 11/30/2023 | 12/20/2023 | 10-Q |
| 08/31/2023 | 10/11/2023 | 10-K |
| 05/31/2023 | 06/01/2023 | 10-Q |
| 02/28/2023 | 03/09/2023 | 10-Q |
| 11/30/2022 | 12/29/2022 | 10-Q |
| Report Date | Filing Date | Filing |
|---|---|---|
| 08/31/2026 | 10/07/2026 | 10-K |
| 05/31/2026 | 06/03/2026 | 10-Q |
| 02/28/2026 | 03/11/2026 | 10-Q |
| 11/30/2025 | 12/17/2025 | 10-Q |
| 08/31/2025 | 10/08/2025 | 10-K |
| 05/31/2025 | 06/05/2025 | 10-Q |
| 02/28/2025 | 03/13/2025 | 10-Q |
| 11/30/2024 | 12/19/2024 | 10-Q |
| 08/31/2024 | 10/09/2024 | 10-K |
| 05/31/2024 | 06/06/2024 | 10-Q |
| 02/29/2024 | 03/13/2024 | 10-Q |
| 11/30/2023 | 12/20/2023 | 10-Q |
| 08/31/2023 | 10/11/2023 | 10-K |
| 05/31/2023 | 06/01/2023 | 10-Q |
| 02/28/2023 | 03/09/2023 | 10-Q |
| 11/30/2022 | 12/29/2022 | 10-Q |
| 08/31/2022 | 10/05/2022 | 10-K |
| 05/31/2022 | 06/02/2022 | 10-Q |
| 02/28/2022 | 03/10/2022 | 10-Q |
| 11/30/2021 | 12/22/2021 | 10-Q |
| 08/31/2021 | 10/06/2021 | 10-K |
| 05/31/2021 | 06/03/2021 | 10-Q |
| 02/28/2021 | 03/10/2021 | 10-Q |
| 11/30/2020 | 12/16/2020 | 10-Q |
| 08/31/2020 | 10/07/2020 | 10-K |
| 05/31/2020 | 06/04/2020 | 10-Q |
| 02/29/2020 | 03/12/2020 | 10-Q |
| 11/30/2019 | 12/23/2019 | 10-Q |
Insider Activity
Updated 9/30/2026| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Frates, Caton | Sr. Executive Vice President | Direct | Sell | 9302026 | 915.93 | 801 | 733,328 | 7,246,838 | Form |
| 2 | Adamo, Claudine | Executive Vice President | Direct | Sell | 9302026 | 915.93 | 2,200 | 2,015,046 | 6,533,796 | Form |
| 3 | Denman, Kenneth D | Direct | Sell | 6252026 | 957.45 | 885 | 847,345 | 4,575,604 | Form | |
| 4 | Frates, Caton | Executive Vice President | Direct | Sell | 4012026 | 993.00 | 700 | 695,100 | 5,774,296 | Form |
| 5 | Adamo, Claudine | Executive Vice President | Direct | Sell | 3112026 | 1003.02 | 730 | 732,205 | 6,139,687 | Form |
| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Frates, Caton | Sr. Executive Vice President | Direct | Sell | 9302026 | 915.93 | 801 | 733,328 | 7,246,838 | Form |
| 2 | Adamo, Claudine | Executive Vice President | Direct | Sell | 9302026 | 915.93 | 2,200 | 2,015,046 | 6,533,796 | Form |
| 3 | Denman, Kenneth D | Direct | Sell | 6252026 | 957.45 | 885 | 847,345 | 4,575,604 | Form | |
| 4 | Frates, Caton | Executive Vice President | Direct | Sell | 4012026 | 993.00 | 700 | 695,100 | 5,774,296 | Form |
| 5 | Adamo, Claudine | Executive Vice President | Direct | Sell | 3112026 | 1003.02 | 730 | 732,205 | 6,139,687 | Form |
| 6 | Jones, Teresa A | Executive Vice President | Direct | Sell | 1232026 | 986.26 | 850 | 838,318 | 4,169,700 | Form |
| 7 | Decker, Susan L | Direct | Sell | 1202026 | 955.00 | 458 | 437,390 | 8,147,999 | Form | |
| 8 | Miller, Russell D | Sr. Executive Vice President | Miller Family Trust | Sell | 1122026 | 916.32 | 1,500 | 1,374,480 | 7,550,477 | Form |
| 9 | Polit, Javier | Executive Vice President | Direct | Sell | 12312025 | 862.89 | 558 | 481,759 | 8,792,548 | Form |
| 10 | Polit, Javier | Executive Vice President | Direct | Sell | 12312025 | 867.21 | 2,049 | 1,776,904 | 9,320,634 | Form |
| 11 | Wilcox, William Richard | Executive Vice President | Direct | Sell | 11122025 | 930.13 | 2,400 | 2,232,312 | 1,860,260 | Form |
| 12 | Barbre, Tiffany Marie | Direct | Sell | 10242025 | 934.62 | 1,239 | 1,158,353 | 4,818,386 | Form | |
| 13 | Adamo, Claudine | Executive Vice President | Direct | Sell | 10242025 | 935.68 | 2,700 | 2,526,336 | 6,410,528 | Form |
| 14 | Miller, Russell D | Sr. Executive Vice President | Miller Family Trust | Sell | 10012025 | 915.00 | 3,381 | 3,093,615 | 8,912,100 | Form |
| 15 | Frates, Caton | Executive Vice President | Direct | Sell | 9302025 | 910.02 | 1,540 | 1,401,431 | 8,448,347 | Form |
Investor Activity (13F)
Updated Oct 8, 2026Active managers (13F portfolio over $250M, at least 3 holdings) with a position over $5M that is either over 10% of their portfolio or held in a concentrated book of 50 or fewer total positions. Index/ETF, sovereign, bank, community-bank and charitable/donor-advised filers are excluded.
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| Emerald Advisors, LLC | $620.3 Mil | 77.0% | 117 | Hold | 13F |
| Greenbrier Partners Capital Management, LLC | $221.7 Mil | 17.1% | 11 | Hold | 13F |
| Aljian Capital Management, LLC | $54.5 Mil | 11.2% | 131 | Hold | 13F |
| Unio Capital LLC | $50.9 Mil | 10.9% | 21 | TRIM -10.3% | 13F |
| Capital Counsel Llc/Ny | $237.6 Mil | 10.1% | 62 | Hold | 13F |
| Provident Trust Co | $468.7 Mil | 9.8% | 22 | TRIM -14.1% | 13F |
| Rempart Asset Management Inc. | $27.9 Mil | 5.9% | 36 | TRIM -10.6% | 13F |
| Haverford Financial Services, Inc. | $16.7 Mil | 5.0% | 46 | Hold | 13F |
| HFR Wealth Management, LLC | $18.2 Mil | 4.5% | 49 | Hold | 13F |
| OAKMONT Corp | $22.6 Mil | 4.3% | 31 | Hold | 13F |
| Defender Capital, LLC. | $11.9 Mil | 4.2% | 34 | Hold | 13F |
| Randolph Co Inc | $39.9 Mil | 3.8% | 43 | Hold | 13F |
| KCM Capital Inc | $18.4 Mil | 3.4% | 31 | Hold | 13F |
| FFG Partners, LLC | $8.5 Mil | 3.4% | 35 | Hold | 13F |
| Local Pensions Partnership Investment Ltd | $148.0 Mil | 3.2% | 32 | TRIM -6.8% | 13F |
| Active Manager |
|---|
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | As Of | Filing |
|---|---|---|---|---|---|---|
| Hyperion Asset Management Ltd | $64.5 Mil | 1.8% | 18 | Exited | Dec 31, 2025 | 13F |
| Agave Capital Management Ltd | $14.2 Mil | 2.4% | 23 | Exited | Dec 31, 2025 | 13F |
| Wilsey Asset Management Inc | $10.9 Mil | 1.7% | 29 | Exited | Dec 31, 2025 | 13F |
| Provident Trust Co | $468.7 Mil | 9.8% | 22 | TRIM -14.1% | Mar 31, 2026 | 13F |
| Rempart Asset Management Inc. | $27.9 Mil | 5.9% | 36 | TRIM -10.6% | Mar 31, 2026 | 13F |
| Unio Capital LLC | $50.9 Mil | 10.9% | 21 | TRIM -10.3% | Mar 31, 2026 | 13F |
| Local Pensions Partnership Investment Ltd | $148.0 Mil | 3.2% | 32 | TRIM -6.8% | Mar 31, 2026 | 13F |
| Active Manager | Value | % of Portfolio | Total Positions | QoQ | Filing |
|---|---|---|---|---|---|
| Emerald Advisors, LLC | $620.3 Mil | 77.0% | 117 | Hold | 13F |
| Provident Trust Co | $468.7 Mil | 9.8% | 22 | TRIM -14.1% | 13F |
| Capital Counsel Llc/Ny | $237.6 Mil | 10.1% | 62 | Hold | 13F |
| Greenbrier Partners Capital Management, LLC | $221.7 Mil | 17.1% | 11 | Hold | 13F |
| Local Pensions Partnership Investment Ltd | $148.0 Mil | 3.2% | 32 | TRIM -6.8% | 13F |
| Aljian Capital Management, LLC | $54.5 Mil | 11.2% | 131 | Hold | 13F |
| Unio Capital LLC | $50.9 Mil | 10.9% | 21 | TRIM -10.3% | 13F |
| Randolph Co Inc | $39.9 Mil | 3.8% | 43 | Hold | 13F |
| Rempart Asset Management Inc. | $27.9 Mil | 5.9% | 36 | TRIM -10.6% | 13F |
| OAKMONT Corp | $22.6 Mil | 4.3% | 31 | Hold | 13F |
| KCM Capital Inc | $18.4 Mil | 3.4% | 31 | Hold | 13F |
| HFR Wealth Management, LLC | $18.2 Mil | 4.5% | 49 | Hold | 13F |
| Haverford Financial Services, Inc. | $16.7 Mil | 5.0% | 46 | Hold | 13F |
| Defender Capital, LLC. | $11.9 Mil | 4.2% | 34 | Hold | 13F |
| FFG Partners, LLC | $8.5 Mil | 3.4% | 35 | Hold | 13F |
COST Trade Sentinel
High Conviction
CONVICTION RATIONALE
Costco's value proposition is strengthening, evidenced by accelerating comparable sales of 7.6% in its most recent period and an improving member renewal rate of 92.3% in its core markets. This demonstrates enduring customer loyalty and provides a clear path for continued earnings growth through high-volume sales and predictable, high-margin membership fees.
STOCK ARCHETYPE
Structurally-Protected Transactional RetailRevenue = (Number of Members × Shopping Frequency × Average Ticket) + (Number of Members × Annual Membership Fee) Growing the high-margin, recurring membership fee base and leveraging fixed operating costs (SG&A) across a larger base of comparable sales.
INVESTMENT THESIS
Evidence suggests yes. Accelerating sales and improving loyalty metrics indicate Costco is successfully capturing greater share of wallet from its highly loyal member base.
- Comparable sales growth accelerated to 7.6% for the five weeks ended October 4, 2026.
- The U.S. & Canada membership renewal rate improved to 92.3% in the latest quarter.
- Worldwide shopper traffic increased 3.3% in the fourth quarter.
- Digitally-enabled sales increased over 20% in fiscal year 2026, exceeding $33 billion.
- The company plans to open up to 33 new warehouses in fiscal 2027.
PRIMARY RISK
The primary concern is a structural slowdown in the core profit engine. The year-over-year growth rate of total paid members has decelerated sequentially, from 5.2% in the first quarter to 3.8% in the fourth quarter, suggesting new customer acquisition is slowing.
- Year-over-year growth in total paid members slowed to 3.8% in Q4.
- This compares to 4.1% growth in Q3 and 5.2% growth in Q1.
- Faster-growing digital and gasoline sales carry lower gross margins, pressuring the overall mix.
- Competitor Walmart is aggressively investing in price, with over 11,000 'rollbacks' in its latest quarter.
| KPI | Status | Rationale |
|---|---|---|
| Comparable Sales Growth (Adjusted) | +6.7% for Q4 FY2026 (adjusted for gas price inflation and FX) - Stable | Adjusted comparable sales growth has been remarkably consistent, holding in a tight 6.6%-6.7% range for the past three quarters. However, the most recent monthly data for September showed an acceleration to 7.6% adjusted growth, suggesting positive momentum heading into the new fiscal year. |
| Membership Renewal Rate | 89.8% worldwide renewal rate at the end of Q4 FY2026 - Turning around | After a period of slight pressure attributed to a growing mix of online sign-ups which renew at a lower rate, the worldwide renewal rate stabilized and then ticked up in the most recent quarter. Management noted on its latest earnings call that it was 'pleasing to see the improvement in overall renewal rates this quarter,' signaling this is a key focus. This improvement in the core loyalty metric is a positive signal, even as headline membership fee revenue growth decelerates as the company laps a fee increase from September 2024. |
| Paid Members | (As of fiscal year-end August 30, 2026) | Represents the total number of paying households or businesses, which is the foundation for both merchandise sales and membership fee revenue. |
| Digitally-enabled Sales Growth | 19.0% (Five weeks ended October 4, 2026) | Measures the growth of sales initiated through a digital device, reflecting the company's progress in its omnichannel strategy and its ability to capture sales through e-commerce and other digital platforms. |
Member Quality vs. Quantity
BULL VIEW
Bulls focus on improving loyalty, with the core U.S. & Canada renewal rate ticking up to 92.3%. They believe deepening engagement with the existing, high-spending base is more valuable than the rate of new sign-ups.
CORE TENSION
Can rising member loyalty and spending offset the decelerating pace of new member acquisition?
PREVAILING SENTIMENT
The latest data, including accelerating 7.6% comparable sales, favors the bull view that member quality is currently winning.
BEAR VIEW
Bears see the slowing year-over-year growth in new paid members, down to 3.8% from 5.2% a year ago, as a leading indicator of saturation that will cap long-term growth.
| Timeline | Event & Metric To Watch |
|---|---|
11/17/2026 - 12/2/2026 | Peer Read-Across On Consumer Health Watch: Peers reporting slowing traffic, trade-down behavior, or weak guidance for the holiday season. |
11/18/2026 | Target Earnings Report Watch: Peer retailer Target is scheduled to report earnings. |
11/19/2026 | Walmart Earnings Report Watch: Peer retailer Walmart is scheduled to report earnings. |
12/10/2026 | Margin Dilution From Reinvestment Watch: Reported gross margin compression despite strong sales, with management citing price investments and mix shift. |
12/10/2026 | Decelerating Membership Flywheel Watch: Paid membership growth falling below the recent 3.8% rate or a decline in renewal rates. |
12/10/2026 | Negative Working Capital Signal Watch: Continued high growth in accounts receivable relative to sales in the next quarterly report. |
12/10/2026 | Quarterly Earnings Report Watch: Costco's next quarterly earnings report is scheduled. |
in January 2027 | Share Repurchase Program Expiration Watch: The company's current share repurchase program is set to expire. |
| Date | Event | Stock Impact |
|---|---|---|
2026-10-07 | September Sales Results Reported Details: On October 7, Costco reported net sales of $30.02 billion for the five weeks ended October 4, 2026, an increase of 13.0 percent from the prior year (ART-1). | +0.7% $935.68 -> $942.25 |
2026-10-07 | Quarterly Dividend Increased Details: | +0.7% $935.68 -> $942.25 |
2026-09-24 | Fourth Quarter Results Beat Estimates Details: On September 24, Costco reported that its Q4 net sales increased 11.2% to $93.9 billion and that its net income beat estimates, according to press reports (ART-2, ART-5). | +2.0% $904.70 -> $922.77 |
2026-08-05 | July Sales Results Reported Details: On August 5, the company reported net sales of $23.12 billion for the retail month of July, an increase of 10.7 percent from the prior year (ART-4). | +0.1% $947.85 -> $949.15 |
2026-07-09 | Analyst Cites Moderating Sales Details: Following a June sales update, an analyst note on July 9 mentioned a "moderation in June comparable sales growth" but maintained a 'Buy' rating (REWIND-1). | -3.9% $951.62 -> $914.80 |
2026-06-30 | Analyst Concerns On Valuation Details: An analyst note in late June argued the company was "egregiously overvalued" with a trailing P/E of 50x and slowing sales/EPS growth rates (REWIND-1). | -2.3% $945.18 -> $923.20 |
2026-05-28 | Negative Post-Earnings Stock Reaction Details: The stock reacted negatively to the earnings call on May 28, 2026, with a two-day stock reaction of -5.0% versus 1.0% for the S&P 500 (MKT-1). | -4.7% $1002.10 -> $954.80 |
Position Sizing
5% - 7%
NORMAL POSITION
Sizing is volatility-based: COST trades at roughly 20% annualized realized (three-month) volatility versus about 11% for the S&P 500 (1.8x the market). A 5% - 7% position keeps a single-name swing of that size within a diversified portfolio's risk budget.
Diversification Alternatives
WMT - Walmart
Scale and Price LeaderWalmart offers greater scale with revenue 2.4 times that of Costco and is aggressively investing in price, widening its price gaps to conventional grocers. It does not require a membership for general access.
AMZN - Amazon.com
Digital and Convenience LeaderAmazon provides superior convenience through its vast e-commerce platform and ultra-fast delivery network. Its Prime membership program is also seeing double-digit year-over-year growth.
Costco is a high-volume logistics company funded by a recurring subscription fee, masquerading as a retailer.
The core of the business is not just selling goods, but an efficient, high-turnover supply chain that enables extreme price competitiveness. This 'pricing authority' attracts and retains a loyal membership base, whose annual fees provide a stable, high-margin profit stream that allows the company to operate on razor-thin merchandise margins. The model creates a virtuous cycle: low prices drive member loyalty and volume, which in turn gives Costco buying power to secure even lower costs.
Sustained positive comparable sales growth, particularly in customer traffic; stable or increasing membership renewal rates; and successful new warehouse openings.
A decline in membership renewal rates, sustained negative traffic trends, or an inability to maintain price gaps with key competitors like Walmart and Amazon.
Short-term fluctuations in quarterly gross margin due to gasoline price volatility or merchandise mix shifts.
Repricing Catalyst
The company is reinvesting IEEPA tariff refunds into lower prices for members, which could drive incremental traffic and reinforce its value perception, potentially accelerating sales and market share gains.
Costco Wholesale — Investor Video Playlist
Industry Resources
| Consumer Staples Resources |
| FoodNavigator |
| Consumer Goods Technology (CGT) |
| Beverage Digest |
| Consumer Staples Merchandise Retail Resources |
| Mass Market Retailers |
| Store Brands |
| Retail Dive |
External Quote Links
| Y Finance | Barrons |
| TradingView | Morningstar |
| SeekingAlpha | ValueLine |
| Motley Fool | Robinhood |
| CNBC | Etrade |
| MarketWatch | Unusual Whales |
| YCharts | Perplexity Finance |
| FinViz |
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