Costco’s Strong Performance Amid Mixed Market Conditions

Costco Wholesale Corporation (COST), based in Issaquah, Washington, boasts a market capitalization of $453.5 billion. This membership-based retailer excels in selling high volumes of discounted food and general merchandise through warehouses and e-commerce platforms in various countries. Costco provides a range of nationally branded and private-label products across categories such as food, electronics, appliances, apparel, and household goods.

Designated as a “mega-cap” stock, Costco belongs to a select group of companies valued at $200 billion or more. The company primarily generates revenue through store sales and membership fees, offering three membership tiers: Business, Gold Star, and Executive. Additionally, Costco offers several services, including gas stations, pharmacies, optical centers, and travel services.

Despite its strong market position, Costco shares are down 4.3% from their 52-week high of $1,078.23. However, over the past three months, shares of COST have returned 7.4%, significantly outperforming the broader Nasdaq Composite’s ($NASX) 2.7% decline during the same period.

In a longer-term perspective, COST has appreciated by 12.7% year-to-date, surpassing NASX, which has seen nearly a 4% dip. Furthermore, Costco shares have gained an impressive 38% over the past 52 weeks, outpacing NASX’s 15.7% return during the same timeframe.

Moreover, COST has maintained trading above both its 50-day and 200-day moving averages since last year, indicating a resilient performance.

Following its Q1 2025 earnings release on December 12, Costco’s shares experienced a slight recovery, supported by robust financial performance. The company reported adjusted earnings per share (EPS) of $3.82 and total revenue of $62.2 billion, both exceeding expectations. Additionally, on February 5, Costco announced net sales of $19.5 billion for January, reflecting a solid 9.2% increase. For the first 22 weeks of the fiscal year, net sales totaled $113.6 billion, up 8.2%. Currently, Costco operates 897 warehouses worldwide alongside various e-commerce sites.

In contrast, competitor Walmart Inc. (WMT) has underperformed COST year-to-date, gaining only 7.9%. Nonetheless, Walmart shares have surged 63.4% over the past 52 weeks, outpacing Costco in that timeframe.

Even with COST’s favorable performance compared to the Nasdaq, analysts maintain a cautiously optimistic outlook on its future. Among the 33 analysts covering the stock, a consensus rating of “Moderate Buy” prevails, and COST is presently trading above the mean price target of $1,063.06.

On the date of publication, Sohini Mondal did not hold positions in any of the securities mentioned in this article. All information and data herein are for informational purposes. For more details, please consult the Barchart Disclosure Policy here.

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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.