Key Highlights
- May net sales at Costco increased 14.5% annually, reaching $24.01 billion
- Comparable store sales advanced 12.5%, driven primarily by US market performance
- Online sales surged 21.1% throughout the reporting period
- COST stock has gained approximately 12% in 2025, surpassing competitors Walmart and BJ’s Wholesale
- Wall Street consensus stands at Moderate Buy with analysts targeting $1,104.95 per share
Shares of Costco moved higher by approximately 1% during Thursday’s pre-market trading hours following the warehouse retailer’s announcement of May net sales totaling $24.01 billion, representing a 14.5% jump compared to $20.97 billion recorded in the same month last year.
Costco Wholesale Corporation, COST
These figures follow a robust third-quarter performance in fiscal 2026, which concluded on May 10 and delivered an 11.6% sales increase. The quarter produced net income of $2.19 billion, translating to diluted earnings per share of $4.93.
Looking at the broader fiscal picture, net sales for the first 39 weeks of the current year reached $221.19 billion — representing a 10% climb versus the corresponding period in the prior year.
Comparable store metrics, which measure performance at locations operating for a minimum of twelve months, expanded 12.5% in May. The United States market remained the primary growth engine behind this expansion.
E-commerce performance stood out as particularly strong, with digital channel sales advancing 21.1% during May. This online momentum has become a recurring theme for Costco as membership base increasingly allocates more purchasing activity to the company’s digital platform.
A noteworthy product development: the retailer launched an exclusive partnership with O Positiv Health, introducing their URO Vaginal Probiotic across 235 physical locations plus Costco.com. While seemingly minor, this move signals the company’s strategic expansion into premium wellness segments designed to enhance member value and retention.
Fuel sales also contributed meaningfully to Q3 performance, with gasoline volumes hitting record levels and providing a revenue boost. However, elevated gas sales typically create margin compression, a dynamic that remains on investor radars.
Analyst Concerns Despite Strong Results
Notwithstanding the impressive sales figures, Wall Street maintains a measured stance. The primary concern centers on valuation — COST currently commands the steepest multiple among large-cap consumer goods peers.
Membership expansion has demonstrated some slowing momentum, a development carrying significant weight given that membership fee revenue represents a cornerstone of Costco’s profitability model. Any weakening in renewal percentages would signal trouble for the underlying business structure.
Gross margin challenges across core merchandise segments including groceries, consumer electronics, and apparel represent another issue analysts have highlighted in recent reporting cycles.
Year-to-date, COST stock has appreciated roughly 12%, outstripping both Walmart and BJ’s Wholesale Club. This relative strength demonstrates market confidence, though it simultaneously elevates valuation concerns for certain investors.
Current Analyst Outlook
Among 24 analysts providing coverage within the last three months, 16 recommend Buy, seven advise Hold, and one suggests Sell — resulting in a Moderate Buy consensus rating.
The consensus price target stands at $1,104.95, indicating potential upside of approximately 15% from present trading levels.
Optimistic analysts forecast revenue approaching $376.8 billion with earnings near $12.6 billion by 2029. An independent fair value analysis values COST at $1,048, pointing to roughly 9% appreciation potential.
Longer-term analyst projections place Costco revenue at $329 billion by 2028, with anticipated earnings of $10.4 billion.
Investors will next focus on Costco’s complete fiscal year earnings report, while the company maintains its practice of releasing monthly sales updates throughout the remainder of 2026.
