2 Reasons to Like COST and 1 to Stay Skeptical Anthony Lee Fri, October 16, 2026 at 12:35 PM EDT 3 min read COST +1.16% ^GSPC -0.68% Trade COST on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Since April 2026, Costco has been in a holding pattern, posting a small loss of 0.8% while floating around $979.55. The stock also fell short of the S&P 500's 9.7% gain during that period.
Designed to be a one-stop shop for the suburban consumer, Costco (NASDAQ:COST) is a membership-only retail chain that sells groceries, apparel, toys, and household items, often in bulk quantities.
Same-store sales is a key performance indicator used to measure organic growth at brick-and-mortar shops for at least a year.
Costco has been one of the most successful retailers over the last two years thanks to skyrocketing demand within its existing locations. On average, the company has posted exceptional year-on-year same-store sales growth of 7.1%.
With $303.2 billion in revenue over the past 12 months, Costco is a behemoth in the consumer retail sector and benefits from economies of scale, giving it an edge in distribution. This also enables it to gain more leverage on its fixed costs than smaller competitors and the flexibility to offer lower prices. However, its scale is a double-edged sword because there is only so much real estate to build new stores, placing a ceiling on its growth. To accelerate sales, Costco likely needs to optimize its pricing or lean into international expansion.
A company's long-term performance is an indicator of its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Regrettably, Costco's sales grew at a mediocre 7.8% compounded annual growth rate over the last three years. This wasn't a great result compared to the rest of the consumer retail sector, but there are still things to like about Costco.
Costco's positive characteristics outweigh the negatives. With its shares trailing the market in recent months, the stock trades at 43× forward P/E (or $979.55 per share). Is now the time to initiate a position? See for yourself in our full research report, it's free.
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