Valued at a market cap of $453.4 billion, Costco Wholesale Corporation (COST) is a retailer that operates an international chain of membership-only warehouses. The Issaquah, Washington-based company offers a curated selection of high-quality, brand-name, and private-label products at substantially lower prices than traditional retail outlets.
This discount retailer has underperformed the broader market over the past 52 weeks. Shares of COST have gained 3.4% over this time frame, while the broader S&P 500 Index ($SPX) has soared 26.6%. However, on a YTD basis, the stock is up 19.8%, outpacing SPX’s 8.1% rise.
Narrowing the focus, COST has also lagged the State Street SPDR S&P Retail ETF’s (XRT) 7% rise over the past 52 weeks. Nonetheless, it has outperformed XRT’s 6.5% YTD drop.
On Apr. 15, shares of COST gained 1% after the company announced a dividend hike, increasing its quarterly payout from $1.30 to $1.47 per share, equivalent to an annualized dividend of $5.88. The dividend is scheduled to be paid on May 15, 2026, to shareholders of record as of May 1, reflecting management’s confidence in the company’s strong cash flow generation and ongoing commitment to returning capital to shareholders.
For the current fiscal year, ending in August, analysts expect COST’s EPS to grow 13% year over year to $20.32. The company’s earnings surprise history is promising. It topped the consensus estimates in each of the last four quarters.
Among the 34 analysts covering the stock, the consensus rating is a "Moderate Buy,” which is based on 19 “Strong Buy,” three “Moderate Buy,” 11 "Hold,” and one "Strong Sell” rating.
The configuration has remained fairly stable over the past three months.
On May 12, Bernstein maintained an "Outperform” rating on COST and raised its price target to $1,192, indicating a 15.4% potential upside from the current levels.
The mean price target of $1,088.83 suggests a 5.4% premium to its current price levels, while its Street-high price target of $1,315 implies a 27.3% potential upside.
