COST changes
Pick any two versions below to diff them.
- Price
- $922.77 → $910.34(−1.3%)
- Discount
- -24.7% → -23.0%(+1.7 pts)
- Risks
- The stock trades about 2223% above the analysts' fair value estimate and near 4844 times trailing earnings, versus about 26 times for the S&P 500. This leaves little room for error: any slowdown in sales growth or renewal rates could trigger an outsized decline as the market re-rates the stock. US tariff policy has kept shifting through 2026, including a temporary import surcharge that expired in July 2026 and newer duties that replaced it. Costco has said it is trying to absorb rather than fully pass on these costs, which pressures its already thin merchandise margins. Membership fees now supply roughly half of Costco's operating income, even though they are a small fraction of reported revenue. A slowdown in membership growth, or weaker renewal rates after a future fee increase, would hit profit disproportionately compared with a dip in merchandise sales alone. Recent comparable-sales growth has been boosted by gasoline price inflation (worldwide average fuel prices per gallon were up over 25% year over year in August 2026) and by calendar timing. If gas prices fall back, headline comparable-sales growth could look noticeably weaker even if underlying shopping volume stays healthy. Warehouse retail is maturing in Costco's largest market, the US, and competitors including Walmart's Sam's Club and Amazon are investing to take share in bulk buying and membership retail. Continued execution by Costco's leadership, CEO Ron Vachris since January 2024 and CFO Gary Millerchip since March 2024, is needed to keep growing ahead of that competition. As a grocery and general-merchandise retailer that sells heavily under its own Kirkland Signature brand, Costco is exposed to product recalls, food-safety incidents, and product-liability claims that could damage trust in that brand.