- Price
- $904.71 → $922.77(+2.0%)
- Discount
- -22.3% → -24.7%(−2.4 pts)
- Next earnings
- 2026-09-24 → 2026-12-24
- Next earnings is estimate
- No → Yes
- Thesis
- Costco trades around $904.71, about 22% above the analysts' $740 fair value estimate. Unlikeat a typical pick on this list, Costco is not cheap relative to that estimate; the question is why investors keep paying a premium for it. The main reason is that Costco'sbecause its membership model produces unusually predictable, recurring profit: 82.9 million paid households renew at Renewal rates sit near record highs, 92.2% in the US and Canada and 89.7% worldwide as of the most recently reported quarter, and membership Membership fee income alone covers roughly half of operating profit, insulating. This insulates results from swings in merchandise pricing. On top of that stable base, salesSales also keep growing quickly: fiscal 2026 net sales rose 10.2% to $297.3 billion, and digitally-enabled comparable sales grew nearly 18% in August 2026 alone. Thethe board also keeps returning cash to shareholders, raising the quarterly dividend to $1.47 per share in April 2026 and paying a $12-per-share special dividend in January 2026payouts. That mix of low uncertainty and steady double-digit growth is why the stock trades near 48 times trailing earnings versus about 26 times for the S&P 500: investorsInvestors are effectively paying for certainty, since the stock trades at a much higher earnings multiple than the broader market. The fiscalFor that premium to be earned, comparable-sales growth and renewal rates need to keep holding up as temporary boosts from gasoline prices and calendar timing fade. Tariff costs also need to stay manageable, since Costco says it is trying to absorb rather than pass on these costs. Fiscal fourth-quarter reportresults, due after the market closes onreported September 24, 2026, isshowed sales still growing at a neardouble-term test of whether that growthdigit pace and those renewal rates are holding upstill near records. The honest counter-case: at today'sThat supports the premium there is little room for a stumblenow. If comparableThe next test comes with first-salesquarter fiscal 2027 results, expected around December 2026, once the temporary boost from gasoline prices has likely faded. If growth cools sharply once gasoline-price and calendar tailwinds fadethose boosts are gone, if tariff costs squeeze Costco's already thin merchandise margins, or if the market simply re-rates a mature, wide-moat retailer back toward a more ordinary multiple, the stockpremium could fall a long way even iffade over the underlying business keeps performing finenext two to four quarters.
- Recent events
- 2026-09-24: Costco reported Q4 fiscal 2026 and full fiscal-year results. Fourth-quarter net sales were $93.9 billion, up 11.2%, and diluted EPS was $6.75 (including $0.15 from one-time IEEPA tariff refunds), up from $5.87 a year earlier. Full fiscal-year net sales were $297.2 billion, up 10.1%. Membership fee income was $1.85 billion, up 7.3%, with 150.4 million total cardholders and an 89.8% worldwide renewal rate.
2026-09-17: Costco expanded its partnership with DoorDash to a nationwide U.S. launch, letting members order same-day delivery from any domestic warehouse.
2026-09-02: Costco reported August 2026 sales and closed fiscal 2026: full fiscal year (52 weeks ended August 30, 2026) net sales were $297.3 billion, up 10.2%. Fourth-quarter (16 weeks) net sales were $93.9 billion, up 11.3%, and August net sales alone were $23.70 billion, up 9.9%, with digitally-enabled comparable sales up 17.9% for the month.
2026-05-28: Costco reported Q3 fiscal 2026 results: net sales of $69.15 billion, up 11.6%, and diluted earnings per share of $4.93, up from $4.28 a year earlier. Membership fee income was $1.37 billion, up 10.7%, with the US/Canada renewal rate at 92.2% and the worldwide rate at 89.7%.
2026-04-15: Costco's board raised the quarterly cash dividend from $1.30 to $1.47 per share ($5.88 annualized), the company's 22nd consecutive annual dividend increase, payable May 15, 2026.
2026-03-05: Costco reported Q2 fiscal 2026 results: net sales of $68.24 billion, up 9.1%, and diluted earnings per share of $4.58, up from $4.02. Membership fee income rose 13.6% to $1.35 billion, with 82.1 million paid members and an 89.7% worldwide renewal rate.
2026-01-16: Costco paid a special cash dividend of $12.00 per share, announced in December 2025, distributing about $5.3 billion to shareholders.
2025-12-11: Costco reported Q1 fiscal 2026 results: net sales of $65.98 billion, up 8.2%, and diluted earnings per share of $4.50, up from $4.04. Membership fee income rose 14% to $1.329 billion, and digitally-enabled comparable sales grew 20.5%.