The company retails branded and private-label merchandise across verticals and categories and at “discounted” or bulk-rate prices. Product categories include grocery and frozen foods, apparel, sporting goods, electronics, auto care, appliances, housewares and even furniture. Nearly 70% of the stores are located in the US with another 13% in Canada and the remainder scattered around the globe.
As of mid-May 2025, Costco’s trailing price-to-earnings ratio (P/E) stood at approximately 60.21, with its forward P/E (based on earnings estimates for the next fiscal year) around 56.87. With Costco’s stock establishing itself above the $1,000 mark, attention naturally turns to its valuation. As of mid-May 2025, Costco’s trailing price-to-earnings ratio (P/E) stood at approximately 60.21, with its forward P/E (based on earnings estimates for the next fiscal year) around 56.87. The beta is 0.99, so Costco’s price volatility has been similar to the market average. Costco’s P/E ratios exceed broad market averages and many retail peers. However, investors often justify this premium due to its consistent growth, predictable earnings, and resilience across economic cycles.
However, it is essential to acknowledge the presence of certain fxcm canada review headwinds, including underlying inflationary pressures, which may pose challenges. Moreover, margins remain a critical area to monitor, with potential concerns stemming from any deleverage in the SG&A rate. Costco Wholesale Corporation, together with its subsidiaries, engages in the operation of membership warehouses in the United States, Puerto Rico, Canada, the United Kingdom, Mexico, Japan, Korea, Australia, Spain, France, Iceland, China, and Taiwan. It offers branded and private-label products in a range of merchandise categories. It also operates pharmacies, opticals, food courts, hearing-aid centers, and tire installation centers, as well as 636 gas stations; and offers business delivery, travel, same-day grocery, and various other services online in various countries. It also operates e-commerce websites in the United States, Canada, the United Kingdom, Mexico, South Korea, Taiwan, Japan, and Australia.
Costco’s demonstrated ability to manage costs effectively and pass through inflationary pressures further supports this investor confidence. This stock pays an annual dividend of $5.20, which amounts to a dividend yield of 0.51%. The stock’s EV/EBITDA ratio is 36.93, with an EV/FCF ratio of 64.38. The U.S. and China agreed to reduce tariffs on each other’s goods for 90 days, boosting global equity markets and easing trade tensions. U.S. tariffs on Chinese imports will drop from 145% to 30%, whi… In 2024, Costco’s revenue was $254.45 billion, an increase of 5.02% compared to the previous year’s $242.29 billion.
What Analysts Think of Costco Stock Ahead of Earnings
This competitive pricing strategy helps Costco maintain steady store traffic and robust sales volumes. Membership fees contribute a steady income stream, regardless of broader economic fluctuations. We expect membership fees to increase 9.6% during the quarter under review.Costco continuously evolves to meet shifting market demands, regularly updating its product portfolio to include everyday necessities and unique, high-demand items. This adaptability has fueled Costco’s domestic and international expansion, marked by the steady opening of new warehouse locations and the growth of e-commerce platforms in markets such as the United States, Canada, the U.K., Mexico, Korea, Taiwan, Japan and Australia. We expect e-commerce comparable sales to jump 21% during the quarter alligator indicator under discussion.With a clear emphasis on delivering value-oriented offerings, Costco remains well-positioned for continued success in the dynamic retail landscape.
Walmart set the tone for retail earnings: How to play the sector
The retailer is expected to report 79.6 million paying members, up from 78.4 million last quarter. Despite market volatility, I focus on companies with consistent dividend growth, indicating strong financial health and stability, to provide income and total returns. If you’re bullish on COST stock for earnings, you want to see an EPS and revenue beat on Thursday with a strong forecast for the rest of the year. If Costco can offer softening remarks related to tariffs, that could be good for stock price movement to the upside.
Is Costco’s $1,000 Price Tag Justified?
At a price-to-earnings multiple (P/E) of 40, Walmart is more attractively priced, but it’s still trading well above the S&P 500 average P/E of 24. The journey to and beyond this four-digit figure invites a closer look at the foundations of Costco’s success and the strategic considerations for investors attempting to navigate this new chapter. The $1,000 level might also be tested as a new psychological support or resistance area. This phase is typically viewed as a period of price discovery as the market digests the new valuation landscape. The most recent increase brought the quarterly payout to $1.30 per share. The journey to and beyond this four-digit figure invites a closer look at the foundations of Costco’s success and the strategic considerations for investors attempting to navigate this new chapter.
Stock Price Statistics
Costco released April sales data on May 7, which showed a 7% increase year-over-year. Strong sales data is a testament to sustainable growth, and this’s what many long-term investors want to see. For me, all of this expected good news from Costco could be what is creating such a low implied volatility environment for the earnings call. Nothing too surprising and nothing too uncertain seems to be the theme for the earnings report. On April 16, Costco raised the quarterly dividend from $1.16 to $1.30, of $5.20 annualized.
While its current market valuation reflects high expectations for continued performance, the company’s fundamentals, strategic growth initiatives, and consistent return of value to shareholders present a compelling narrative. In the second quarter of fiscal 2025, these fees amounted to $1.193 billion. Executives have said Costco should be see the benefits of its membership fee increase, which took effect at the turn of its fiscal year in September, start to positively impact its profit in the second half of its fiscal 2025, and into fiscal 2026. The analysts said that high-margin membership revenue should give Costco more room to absorb the impact of tariffs without raising prices. The bulk of Costco’s warehouses are in North America, and global expansion is a massive opportunity. The company reports earnings later this month, but its comparable-store sales for the 35-week period ended May 4 grew 5.9%.
- Nothing too surprising and nothing too uncertain seems to be the theme for the earnings report.
- At a price-to-earnings multiple (P/E) of 40, Walmart is more attractively priced, but it’s still trading well above the S&P 500 average P/E of 24.
- Costco Wholesale (COST) is set to report its results for the third quarter of fiscal 2025 after the closing bell on Thursday, with analysts generally bearing bullish ratings on the stock but not expecting substantial share-price gains.
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- ROST, Dollar General Corporation DG and Target Corporation TGT.
- The Motley Fool has positions in and recommends Costco Wholesale and Walmart.
- Costco has strengthened its position as a retail powerhouse, thanks to its strong membership model, competitive pricing and ability to adapt to evolving market trends.
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- Several core fundamental strengths have propelled Costco’s stock to its current levels.
- The Price family eventually exit the business in favor of new operations resulting in the rebranding to Costco Wholesale Corporation.
The stock has rallied 24%, outpacing the industry’s rise of 12.5%.COST has outperformed its competitors, including Ross Stores, Inc. ROST, Dollar General Corporation DG and Target Corporation TGT. Shares of Ross Stores, Dollar General and Target have faced declines of 0.3%, 28.7% and 35.9%, respectively. Costco Wholesale’s stock surpassing the $1,000 mark clearly indicates its formidable business model, consistent execution, and enduring appeal to millions of members worldwide. Costco Wholesale’s stock surpassing the $1,000 mark clearly indicates its formidable business model, consistent execution, and enduring appeal to millions of members worldwide.
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This is good news for the health of the company because distributing dividends means more cash is on hand from profitability. Remember, dividends are non-events from a transaction standpoint because the stock price drops the same amount as the dividend that’s distributed. For dividend investing to work out long-term, the stock price needs to be higher than your purchase price over time. Founded in 1993, The Motley Fool is a financial services company dedicated to making the world smarter, happier, and richer. The Motley Fool reaches millions of people every month through our premium investing solutions, free guidance and market analysis on Fool.com, personal finance education, top-rated podcasts, and non-profit The Motley Fool Foundation. The Motley Fool reaches millions of people every month through our premium investing solutions, free guidance and market analysis on Fool.com, top-rated podcasts, and non-profit The Motley Fool Foundation.
Costco’s upcoming Q earnings will reveal how the membership fee hike affects… Costco Wholesale (COST) is set to report its results for the third quarter of fiscal 2025 after the closing bell on Thursday, with analysts generally bearing bullish ratings on the stock but not expec… According to 28 analysts, the average rating for COST stock is “Buy.” The 12-month stock price forecast manias, panics, and crashes is $1,032.89, which is an increase of 1.53% from the latest price. Today, Costco is based in Issaquah, Washington and it is among the largest businesses in the world. The company operates as a member-only big-box retailer claiming more than 118 million members, it is ranked #10 on the Forbes Fortune 500 list and is the 5th largest retailer internationally. In terms of scale, it is the largest retailer of choice and prime beef, organic foods and rotisserie chickens.
The P/E ratio is a widely used metric to gauge how much investors are willing to pay for each dollar of a company’s earnings. Finally, the company’s e-commerce channel has become an increasingly important growth driver. In Q2 FY25, e-commerce comparable sales saw an adjusted increase of 22.2%, indicating successful adaptation to evolving consumer shopping preferences. Costco Wholesale (COST) is set to report its results for the third quarter of fiscal 2025 after the closing bell on Thursday, with analysts generally bearing bullish ratings on the stock but not expecting substantial share-price gains. In addition to retail, the company also provides many services including pharmacy, eye care, food & beverage and auto care centers. The company also operates more than 665 gas stations across its footprint and a robust eCommerce channel.
Valuation Ratios
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The existence of this Marketing Agreement should not be deemed as an endorsement or recommendation of Marketing Agent by tastytrade. Tastytrade and Marketing Agent are separate entities with their own products and services. Costco is expected to announce earnings-per-share (EPS) of $4.24 on $63.10 billion in revenue. Revenue estimates are almost exactly the same as last quarter, while EPS estimates are up 3% from last quarter. Now can be a risky time to invest in the stock market, amid so much economic uncertainty.