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Opinions Jim Cramer - Mad Money
Costco Wholesale CorporationCOSTBUY ON WEAKNESSMar 10, 2025
Jim Cramer - Mad MoneyStock price when the opinion was issued
As of Aug 25, 2026. Market Open.
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Has traded at a high valuation pretty much since it went public. Good luck trying to pick a perfect valuation entry point. He invests in companies that can invest cashflows at high rates of return over decades. Stealing market share from low- and middle-end grocery stores. Adding services, such as Medicare plans in the US. Same-store sales growth 7-8% a year.
Deserves to trade at a high multiple because of business durability over the long term. Yield is 0.60%.
Barry Schwartz
High valuation but is growing double digits, which it should do so for years. They have the lowest prices of products compared to peers. A lot of room to expand location. A great business model. He will hold this forever.
Barry SchwartzA buy-and-hold forever. Omnichannel retailer, as it's increasingly seeing acceleration in e-commerce and delivery channels.
Brian MaddenHe wrote an in-the-money call at $985. It was trading over $1,000 yesterday down to $950 today. He covered half the position and just closed it out at $5. He netted a $22 profit. Earnings were good, as expected. You can add to it at these levels, despite the high PE.
Kevin Simpson
Both great companies, but both very expensive. COST is over 50x PE, and WMT's in the 40s. Fairly low-margin model. Reliant on the consumer, and everyone's affected when that consumer is struggling.
WMT reported today. Earnings were OK, but projections on future quarters were tough. High fuel prices were highlighted.
No valuation concerns, as it's been expensive every day he's looked at it over 30 years. Compounded shareholder total return of 17.5% since its IPO. Third-largest retailer in the world. Procurement clout and supply-chain efficiencies produce gross margins of 11%. Still expanding store count. Periodically increases membership fees. Superior same-store sales performance driven by traffic and basket size.
Lots of ways to win. Yield is 0.59%.
Brian MaddenThe only consumer staples he owns are COST and KO, which are still growing.
Barry Schwartz
They had a terrific quarter, but fell 6% anyway. Is -13% from all-time high of a few weeks ago. But it usually sells off on good quarters, but bounces back, so you must buy it into weakness. Almost always. They reported a revenue beat, but earnings miss. Same-store sales were +6.8%, beating the street. Operating margin barely missed as did EPS. Costco shoppers are still spending, but getting picky about value. Non-food same-store sales growth was around 15%, good. Only one-sixth of their goods come from China, Canada and Mexico, so they are fairly insulated from tariffs; and they can replaced those tariffed items with non-tariffed ones. Shares are hit because it's a high-PE stock and the market is down. Shares now are a buying opportunity.