Costco Wholesale (NASDAQ:COST) Shares Climb 2.8% - Time to Buy?

Key Points

• Costco shares rose 2.8% to about $1,040.55, while the company’s latest quarterly results exceeded expectations: EPS was $6.75 versus $6.54 expected, and revenue increased 11.1% year over year to $95.72 billion.
• Growth prospects remain positive, supported by approval for a new New Hampshire warehouse, expanded DoorDash and Uber Eats delivery partnerships, and reported grocery market-share gains as consumers seek lower prices.
• Analyst sentiment is broadly favorable, with a consensus “Moderate Buy” rating and an average price target of $1,086.19. However, Costco’s valuation is elevated at roughly 50 times earnings, while ETF selling and recent insider sales present near-term caution points.

Costco Wholesale Corporation (NASDAQ:COST - Get Free Report) shares rose 2.8% during mid-day trading on Monday. The company traded as high as $1,042.56 and last traded at $1,040.55. 3,104,804 shares traded hands during trading, an increase of 41% from the average session volume of 2,200,425 shares. The stock had previously closed at $1,012.28.

Costco Wholesale News Roundup

Here are the key news stories impacting Costco Wholesale this week:

• Positive Sentiment: New Hampshire store approved: Costco received approval to build a warehouse at Seacoast Landing in Newington, with an opening targeted for 2027. The location should expand Costco’s physical footprint and create another source of membership and sales growth. Costco gets approval to build at Seacoast Landing in Newington
• Positive Sentiment: Delivery partnerships could lift sales: Costco’s broader availability through DoorDash and Uber Eats is expected to attract younger and more convenience-oriented shoppers, increase digital sales and add revenue without materially reducing warehouse traffic. Can Costco's DoorDash and Uber Eats Expansion Drive Incremental Sales?
• Positive Sentiment: Market-share gains reinforce the value proposition: Costco is reportedly gaining grocery share as consumers seek lower prices amid elevated household expenses. This supports traffic, membership renewal prospects and sales growth. The latest update on the grocery wars is here
• Neutral Sentiment: Dividend payment approaches: Costco is scheduled to pay its final quarterly dividend of 2026 on November 13, providing a modest near-term shareholder return but likely having limited influence on valuation. Costco to pay dividends next week
• Neutral Sentiment: Stock split speculation continues: Analysts note that Costco may not split its shares in 2027; the company has split its stock only a limited number of times, most recently in 2000. A split would improve affordability but would not change the company’s underlying value. Costco Wholesale Stock Is Trading Over $1,000
• Negative Sentiment: ETF selling may weigh on demand: Exchange-traded funds were reported to be net sellers of approximately $75.6 million in COST shares on October 29, creating some short-term supply pressure. ETFs Are Net Sellers of Costco

Wall Street Analyst Weigh In

Several research analysts recently issued reports on the company. HSBC upgraded Costco Wholesale to a "buy" rating in a research report on Friday, September 25th. Deutsche Bank Aktiengesellschaft dropped their price target on Costco Wholesale from $1,091.00 to $1,079.00 and set a "buy" rating for the company in a research report on Monday, September 28th. TD Cowen began coverage on Costco Wholesale in a research report on Friday. They set a "strong-buy" rating for the company. Bank of America cut their price target on Costco Wholesale from $1,200.00 to $1,095.00 and set a "buy" rating for the company in a report on Wednesday, September 16th. Finally, UBS Group restated a "buy" rating on shares of Costco Wholesale in a research report on Thursday, September 17th. One research analyst has rated the stock with a Strong Buy rating, twenty-four have given a Buy rating, eight have issued a Hold rating and one has given a Sell rating to the company's stock. According to data from MarketBeat, Costco Wholesale has an average rating of "Moderate Buy" and a consensus price target of $1,086.19.

Costco Wholesale Trading Up 2.8%

The business has a 50 day simple moving average of $943.31 and a two-hundred day simple moving average of $970.25. The company has a current ratio of 1.06, a quick ratio of 0.62 and a debt-to-equity ratio of 0.11. The company has a market cap of $461.10 billion, a PE ratio of 50.12, a price-to-earnings-growth ratio of 4.32 and a beta of 0.84.

Costco Wholesale (NASDAQ:COST - Get Free Report) last posted its quarterly earnings results on Thursday, September 24th. The retailer reported $6.75 EPS for the quarter, beating the consensus estimate of $6.54 by $0.21. The company had revenue of $95.72 billion during the quarter, compared to analysts' expectations of $94.97 billion. Costco Wholesale had a return on equity of 27.60% and a net margin of 3.04%. The firm's revenue was up 11.1% on a year-over-year basis. During the same quarter in the previous year, the business earned $5.87 EPS. On average, analysts forecast that Costco Wholesale Corporation will post 22.70 EPS for the current fiscal year.

Costco Wholesale Announces Dividend

The company also recently declared a quarterly dividend, which will be paid on Friday, November 13th. Shareholders of record on Friday, October 30th will be paid a dividend of $1.47 per share. The ex-dividend date is Friday, October 30th. This represents a $5.88 annualized dividend and a yield of 0.6%. Costco Wholesale's dividend payout ratio is currently 28.32%.

Insider Activity

In other news, EVP William Richard Wilcox sold 1,100 shares of the business's stock in a transaction dated Tuesday, October 13th. The stock was sold at an average price of $958.21, for a total transaction of $1,054,031.00. Following the completion of the sale, the executive vice president owned 3,094 shares in the company, valued at approximately $2,964,701.74. The trade was a 26.23% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. Also, EVP Claudine Adamo sold 2,200 shares of the business's stock in a transaction dated Tuesday, September 29th. The stock was sold at an average price of $915.93, for a total value of $2,015,046.00. Following the sale, the executive vice president owned 7,134 shares of the company's stock, valued at $6,534,244.62. The trade was a 23.57% decrease in their position. The SEC filing for this sale provides additional information. Corporate insiders own 0.10% of the company's stock.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently bought and sold shares of the business. Contravisory Investment Management Inc. lifted its holdings in shares of Costco Wholesale by 107.7% during the 3rd quarter. Contravisory Investment Management Inc. now owns 27 shares of the retailer's stock valued at $25,000 after acquiring an additional 14 shares in the last quarter. C M Bidwell & Associates Ltd. acquired a new stake in Costco Wholesale in the 2nd quarter valued at $28,000. Burk Holdings LLC acquired a new stake in Costco Wholesale in the 2nd quarter valued at $30,000. Manning & Napier Advisors LLC acquired a new stake in Costco Wholesale in the 2nd quarter valued at $30,000. Finally, John Boyer Inc. purchased a new position in Costco Wholesale in the third quarter valued at about $32,000. 68.48% of the stock is owned by institutional investors and hedge funds.

About Costco Wholesale

Costco Wholesale Corporation operates a membership-based warehouse retail business under the Costco name. The company sells merchandise in bulk and at competitive prices through warehouse clubs and e-commerce platforms, serving individual consumers, businesses and other organizations.

Its product selection includes groceries and fresh foods, household supplies, appliances, electronics, furniture, apparel, health and beauty products, jewelry, automotive products and prescription drugs. Costco also provides services such as optical care, pharmacy services, hearing-aid sales, travel offerings and fuel sales, depending on location.

The company traces its roots to Price Club, which opened in San Diego in 1976.

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