Costco Wholesale (NASDAQ:COST – Get Free Report) posted its quarterly earnings results on Thursday. The retailer reported $4.93 earnings per share (EPS) for the quarter, missing the consensus estimate of $4.98 by ($0.05), FiscalAI reports. The firm had revenue of $70.53 billion during the quarter, compared to the consensus estimate of $69.68 billion. Costco Wholesale had a net margin of 2.99% and a return on equity of 28.57%. During the same quarter in the prior year, the business earned $4.28 EPS.
Here are the key takeaways from Costco Wholesale’s conference call:
- Costco reported a strong third quarter, with net income up 15% to $2.19 billion and net sales up 11.6% to $69.15 billion, while comparable sales rose 9.8%.
- Membership remains healthy, with membership fee income up 10.7% and paid executive memberships up 9.6%; management said executive member growth and renewal efforts are helping offset slower overall member growth.
- Costco highlighted strong demand in gas, saying record volumes were driven by higher prices and consumer price sensitivity, and that first-time gas users could become more loyal, higher-spending members over time.
- Margins were mixed: reported gross margin declined 21 basis points, but excluding gas inflation it was roughly flat to slightly better, while SG&A improved on the surface but was pressured by healthcare and some one-time items.
- Digital and technology initiatives are gaining traction, including 21.5% digitally enabled comparable sales growth, faster checkout tools, same-day delivery expansion in Europe, and early benefits from AI-driven search and retail media partnerships.
Costco Wholesale Price Performance
Shares of COST opened at $956.32 on Friday. The company has a current ratio of 1.06, a quick ratio of 0.59 and a debt-to-equity ratio of 0.18. Costco Wholesale has a 1 year low of $844.06 and a 1 year high of $1,096.50. The stock has a market cap of $424.27 billion, a P/E ratio of 49.73, a price-to-earnings-growth ratio of 4.90 and a beta of 0.92. The stock’s 50-day moving average price is $1,007.80 and its two-hundred day moving average price is $962.48.
Costco Wholesale Increases Dividend
Insider Transactions at Costco Wholesale
In other Costco Wholesale news, EVP Claudine Adamo sold 730 shares of the firm’s stock in a transaction dated Monday, March 9th. The stock was sold at an average price of $1,003.02, for a total transaction of $732,204.60. Following the transaction, the executive vice president owned 6,121 shares in the company, valued at approximately $6,139,485.42. This trade represents a 10.66% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through the SEC website. Company insiders own 0.10% of the company’s stock.
Hedge Funds Weigh In On Costco Wholesale
A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Morgan Stanley boosted its holdings in Costco Wholesale by 1.1% during the fourth quarter. Morgan Stanley now owns 9,523,423 shares of the retailer’s stock worth $8,212,433,000 after buying an additional 107,775 shares during the last quarter. Charles Schwab Investment Management Inc. boosted its holdings in Costco Wholesale by 2.5% during the fourth quarter. Charles Schwab Investment Management Inc. now owns 3,282,011 shares of the retailer’s stock worth $2,830,209,000 after buying an additional 79,149 shares during the last quarter. Amundi boosted its holdings in Costco Wholesale by 45.0% during the third quarter. Amundi now owns 3,176,606 shares of the retailer’s stock worth $2,893,697,000 after buying an additional 986,182 shares during the last quarter. Price T Rowe Associates Inc. MD boosted its holdings in Costco Wholesale by 13.4% during the fourth quarter. Price T Rowe Associates Inc. MD now owns 1,953,923 shares of the retailer’s stock worth $1,684,947,000 after buying an additional 230,618 shares during the last quarter. Finally, Vestor Capital LLC boosted its holdings in Costco Wholesale by 20,936.6% during the fourth quarter. Vestor Capital LLC now owns 970,840 shares of the retailer’s stock worth $837,194,000 after buying an additional 966,225 shares during the last quarter. Institutional investors own 68.48% of the company’s stock.
Wall Street Analysts Forecast Growth
Several equities analysts recently issued reports on COST shares. UBS Group raised their price target on Costco Wholesale from $1,205.00 to $1,275.00 and gave the company a “buy” rating in a report on Wednesday, May 20th. Gordon Haskett raised their price target on Costco Wholesale from $1,000.00 to $1,100.00 in a report on Tuesday, February 3rd. DA Davidson reiterated a “neutral” rating and issued a $1,000.00 price target on shares of Costco Wholesale in a report on Friday. Weiss Ratings upgraded Costco Wholesale from a “hold (c+)” rating to a “buy (b-)” rating in a report on Tuesday, March 17th. Finally, Raymond James Financial raised their price target on Costco Wholesale from $1,000.00 to $1,100.00 and gave the company an “outperform” rating in a report on Friday, March 6th. Twenty-one equities research analysts have rated the stock with a Buy rating, eleven have issued a Hold rating and one has assigned a Sell rating to the company’s stock. According to data from MarketBeat, the stock has a consensus rating of “Moderate Buy” and a consensus price target of $1,056.32.
Check Out Our Latest Research Report on Costco Wholesale
Costco Wholesale News Roundup
Here are the key news stories impacting Costco Wholesale this week:
- Positive Sentiment: Costco posted strong third-quarter results, with revenue of $70.53 billion topping estimates and same-store sales rising 9.8%, showing that members are still spending on essentials and value-focused purchases.
- Positive Sentiment: Gasoline sales were a standout, with Costco’s gas stations setting all-time or record volume levels as drivers sought lower-priced fuel amid elevated energy costs. Article Title
- Positive Sentiment: Digital growth and membership strength continued to support results, helping offset margin pressure and reinforcing Costco’s value-driven model.
- Positive Sentiment: Several Wall Street firms raised price targets or reiterated bullish ratings, including Bank of America, Goldman Sachs, Bernstein, BTIG, and Morgan Stanley, signaling confidence in Costco’s long-term fundamentals.
- Neutral Sentiment: DA Davidson reaffirmed a neutral rating with a $1,000 target, suggesting modest upside but not a strong catalyst for a re-rating.
- Neutral Sentiment: Costco said it will return U.S. tariff refunds to members “in some form,” which may help customer loyalty but does not yet provide a clear financial boost.
- Negative Sentiment: EPS of $4.93 missed consensus by a small margin, and investors appear focused on the earnings shortfall more than the sales beat.
- Negative Sentiment: Margin pressure from higher costs and a premium valuation have prompted some traders to sell after the report, limiting enthusiasm despite the strong top-line performance.
Costco Wholesale Company Profile
Costco Wholesale Corporation operates a global chain of membership-only warehouse clubs that sell a wide array of merchandise in bulk at discounted prices. The company’s product mix includes groceries, fresh and frozen food, household goods, electronics, apparel, and seasonal items, augmented by its prominent private-label brand, Kirkland Signature. Costco’s business model centers on annual membership fees and high-volume, low-margin sales, designed to drive repeat purchasing and strong customer loyalty among both consumers and small-business buyers.
Beyond merchandise, Costco provides a range of ancillary services that complement its warehouses, including gasoline stations, pharmacy and optical services, hearing aid centers, photo services, and travel and insurance products.
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