NASDAQ:COST

Costco Wholesale Corporation (COST)

951.58
+16.55 (1.77%)
as of Jul 27, 2026, 8:00:00 pm Market Open.
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Investor Insights
star iconJul 27, 2026, 12:00 am

This summary was created by AI, based on 51 opinions in the last 12 months.

Costco Wholesale Corporation (COST) is widely recognized as a strong business, with both customers and employees expressing high satisfaction. Analysts note Costco’s capability for long-term growth through continuous store expansion and a successful membership model. However, concerns about its high price-to-earnings (PE) ratio—ranging from 44x to over 50x—dominate discussions, leading many experts to hesitate regarding its current valuation. While some maintain that Costco represents a buy-and-hold opportunity due to its consistency and business model, others emphasize that the high valuation may limit potential returns. Overall, Costco is viewed as a resilient company, navigating through economic challenges while continuing to please its loyal customer base.

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Consensus
Hold
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Valuation
Overvalued
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STRONG BUY

What metric did you use to buy this? He bought this in Q4 2008. It wasn't a bargain, but actually went up that year. He bought it because he expected them, as they grew revenues, to eventually get gross margin from merchandise and not only memberships. This took three years to happen and have been making money this way since. They keep growing customers, because they have the lowest mark-ups on Earth. The risk is that Millennials prefer a competitive price vs. the lowest (Amazon) price. Will this switch when they age? COST also owns real estate in wealthy areas, and they run a pristine balance sheet. Workers own a lot of the company stock too. Incredibly managed.

HOLD

Has done very well. Higher highs, higher lows. Keeps pushing above the 200 day MA. Defensive growth name. A bit expensive. Execution online has lagged. Other challenge is attracting millennial traffic. His preference is for Dollar General, but a decent name. Decent dividend of 1%.

HOLD

A fine holding to keep. They have proven their membership and pricing model works and they can even thrive in the digital era -- even against Amazon.

BUY ON WEAKNESS
Its average shopper has one of the highest per capita incomes in the US. He has looked to buy it many times, but it is always a little too expensive in term of multiples.
BUY
Going into the next couple of months, market's missed where the US consumer is right now. Wealth effect is being generated into the next quarters. Thinks consumer numbers will be better, and this will benefit Costco. Expensive, but offers value now.
COMMENT
This is a huge engine that has continued to post strong numbers. They generate a lot of cash. This is a real growth stock. It is difficult to buy this stock at any reasonable valuation. It has never traded below 20X earnings over the last 5 years. It is a very low margin and is all about turnover. They generate about 25% of their revenues from membership fees. The business executes well.
HOLD
One of the few retailers battling against Amazon, due to their loyal customers. They make all their money on memberships -- making only 17% margin on products sold. He likes their business model and expects them to do well even during a prolonged Chinese trade war.
COMMENT
This has hit a new 52 week high. Franchise is fantastic. They make a lot of money off their memberships. It is an expensive stock and has about a 10% growth rate. He prefers more defensive areas such as Dollar Stores. He does like Costco though
HOLD
He is not huge into staples right now. They announced a $4 billion share buyback. Earnings are trending higher. There are others in the space that offer better value for investors. They do things well and will continue to do well. If you are in the space, you should own this.
BUY ON WEAKNESS

A struggle--a retailer competing against Amazon yet thriving through quality merchandise. But COST needs a better entry price. Brilliantly run company

BUY
Safe place to be. Constantly produces high single digit growth. Good balance sheet. They treat their employees well and that counts in the long term. They haven't been Amazoned yet.
COMMENT
As a long-term hold? A great company that keeps producing results. Trades at a high multiple in the retail space. If you own a lot of this in your portfolio, say over 10%, then take some money off the table.
DON'T BUY
A great business model driven by memberships which mostly makes up their $3 billion net profit. A very good company. But it trades at 27x earnings, which has always puzzled him--why so high? This makes COST risky. So, any misstep can be costly.
HOLD
They continue to thrive against Amazon and he likes their business model. Upside in the stock price will depend on the health of consumer spending. A good core holding.
COMMENT
It's done very well, but its valuation is high at 27X forward earnings with an 11% growth rate. Strong same-store sales and membership renewals (at 90%). Their sales are twice as high as their competitors. Long-term, they must have more of an online presence and service to compete. Also, in the future will millennials buy memberships?
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