Costco Faces New Lawsuit Over Chicken Contamination
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy COST?
Source: seekingalpha
- Lawsuit Background: An animal rights nonprofit has accused Costco of salmonella contamination at its Nebraska chicken processing plant, filing a class action lawsuit that highlights the real danger to consumers and breaches their trust.
- Consumer Impact: Plaintiff Lisa Taylor claims she regularly buys one or two rotisserie chickens monthly from Costco, believing she overpaid due to undisclosed contamination risks, reflecting growing consumer concerns over food safety.
- Sales Data: Costco reported over 157 million rotisserie chickens sold worldwide in 2025 during its annual meeting last month, indicating strong market demand, but the lawsuit could undermine consumer confidence.
- Market Reaction: This lawsuit may negatively impact Costco's brand image and sales, particularly as consumer awareness of food safety increases, potentially leading to decreased sales and customer attrition.
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Analyst Views on COST
Wall Street analysts forecast COST stock price to rise
24 Analyst Rating
19 Buy
4 Hold
1 Sell
Strong Buy
Current: 998.860
Low
769.00
Averages
1061
High
1205
Current: 998.860
Low
769.00
Averages
1061
High
1205
About COST
Costco Wholesale Corporation (Costco) operates membership warehouses and e-commerce sites that offer a selection of nationally branded and private-label products in a wide range of categories. The Company buys the majority of its merchandise directly from suppliers and route it to cross-docking consolidation points (depots) or directly to its warehouses. It operates 891 warehouses, including 614 in the United States and Puerto Rico, 108 in Canada, 40 in Mexico, 35 in Japan, 29 in the United Kingdom, 19 in Korea, 15 in Australia, 14 in Taiwan, seven in China, five in Spain, two in France, and one each in Iceland, New Zealand and Sweden. It also operates e-commerce sites in the United States, Canada, the United Kingdom, Mexico, Korea, Taiwan, Japan and Australia. The Company provides wide selection of merchandise, plus the convenience of specialty departments and exclusive member services.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Costco Enhances Membership Services and Operating Hours
- Enhanced Membership Value: Costco's Executive membership fee of $130 per year is easily offset by savings on groceries and household essentials, which significantly boosts customer loyalty and satisfaction.
- Customer Service Excellence: Renowned for its exceptional customer service, Costco allows returns without receipts, creating a hassle-free shopping experience that not only enhances customer satisfaction but also encourages repeat purchases.
- Extended Operating Hours: Last year, Costco added an extra shopping hour on Saturday evenings, improving the shopping experience, especially during peak weekend times, helping customers avoid crowds and enhancing overall convenience.
- Holiday Operating Strategy: While Costco closes on several major holidays to accommodate employees, it remains open on Presidents Day, reflecting its commitment to member needs, although this may lead to increased foot traffic and longer wait times.
See More
Costco Faces New Lawsuit Over Chicken Contamination
- Lawsuit Background: An animal rights nonprofit has accused Costco of salmonella contamination at its Nebraska chicken processing plant, filing a class action lawsuit that highlights the real danger to consumers and breaches their trust.
- Consumer Impact: Plaintiff Lisa Taylor claims she regularly buys one or two rotisserie chickens monthly from Costco, believing she overpaid due to undisclosed contamination risks, reflecting growing consumer concerns over food safety.
- Sales Data: Costco reported over 157 million rotisserie chickens sold worldwide in 2025 during its annual meeting last month, indicating strong market demand, but the lawsuit could undermine consumer confidence.
- Market Reaction: This lawsuit may negatively impact Costco's brand image and sales, particularly as consumer awareness of food safety increases, potentially leading to decreased sales and customer attrition.
See More
Amazon: The Smartest Growth Stock to Buy Now
- Attractive Valuation: Amazon's stock is currently trading at about 26.5 times the 2026 expected P/E ratio, significantly lower than valuations of traditional retailers like Walmart and Costco, making it one of the cheapest investment opportunities in its history and attracting investor interest.
- Operational Efficiency Gains: With over 1 million robots deployed in its distribution centers and coordinated by the DeepFleet AI model, Amazon has not only increased delivery speed but also significantly enhanced operational efficiency, driving sales growth.
- Advertising Revenue Surge: Amazon's high-margin sponsored ad business saw a 22% revenue increase last quarter, becoming a key driver of its operating income growth and further solidifying its leading position in the global digital advertising space.
- Cloud Computing Market Leadership: Holding the number one market share in cloud computing, Amazon's revenue growth reached 24% in Q4, the highest in over three years, indicating its commitment to invest $200 billion in capital expenditures to meet the booming demand for AI infrastructure.
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Costco Reports $66 Billion in Q1 Sales, Highlights Investment Potential
- Strong Sales Performance: Costco achieved net sales of $66 billion in the first quarter of fiscal 2026, reinforcing its leadership position in the global retail sector and further solidifying its market share.
- Attractive Investment Returns: With a total return of 193% over the past five years, Costco's stock has provided significant returns for investors, drawing increased attention from potential shareholders.
- Ongoing Expansion Plans: The management's strategy to open 25 to 30 new warehouses annually is expected to drive future revenue and profit growth, enhancing the company's competitive edge in the market.
- Cautious Investment Advice: While Costco is a high-quality business, its current price-to-earnings ratio of 52 indicates a high entry point, suggesting that investors should exercise patience and wait for a more favorable buying opportunity to ensure investment safety.
See More
Costco Reports $66 Billion in Q1 Sales for Fiscal 2026
- Sales Growth: Costco's net sales reached $66 billion in the first quarter of fiscal 2026, underscoring its leadership in the global retail sector, while providing investors with a total return of 193% over five years, reflecting strong market performance.
- Membership Expansion: With membership households now at 81 million and the company opening 25 to 30 new warehouses annually, Costco is poised for continued revenue and profit growth, enhancing its competitive position in the market.
- Investment Advice: Despite being a high-quality business, Costco's current price-to-earnings ratio of 52 indicates an expensive stock price with no margin of safety, suggesting that investors should be patient and wait for a more favorable entry point.
- Market Performance Comparison: Costco's total return of 193% contrasts sharply with the Motley Fool Stock Advisor's average return of 886%, highlighting the potential for higher returns in other stocks, prompting investors to consider diversifying their investment choices.
See More
Costco's Market Leadership and Investment Advice
- Strong Sales Performance: Costco reported net sales of $66 billion in the first quarter of fiscal 2026, underscoring its leadership in the global retail sector and continuing to attract investor interest.
- Significant Investment Returns: Over the past five years, Costco's stock has generated a total return of 193%, providing substantial gains for investors, although the current price-to-earnings ratio of 52 indicates a high entry cost.
- Ongoing Expansion Plans: The company plans to open 25 to 30 new warehouses each year, further solidifying its market share and driving future revenue and profit growth, demonstrating its strong business resilience.
- Caution for Investors: While Costco is an excellent company, its current high valuation suggests that new investors should exercise patience and wait for a more favorable entry point to mitigate risks.
See More
Costco Enhances Membership Services and Operating Hours
- Enhanced Membership Value: Costco's Executive membership fee of $130 per year is easily offset by savings on groceries and household essentials, which significantly boosts customer loyalty and satisfaction.
- Customer Service Excellence: Renowned for its exceptional customer service, Costco allows returns without receipts, creating a hassle-free shopping experience that not only enhances customer satisfaction but also encourages repeat purchases.
- Extended Operating Hours: Last year, Costco added an extra shopping hour on Saturday evenings, improving the shopping experience, especially during peak weekend times, helping customers avoid crowds and enhancing overall convenience.
- Holiday Operating Strategy: While Costco closes on several major holidays to accommodate employees, it remains open on Presidents Day, reflecting its commitment to member needs, although this may lead to increased foot traffic and longer wait times.
See More
Costco Faces New Lawsuit Over Chicken Contamination
- Lawsuit Background: An animal rights nonprofit has accused Costco of salmonella contamination at its Nebraska chicken processing plant, filing a class action lawsuit that highlights the real danger to consumers and breaches their trust.
- Consumer Impact: Plaintiff Lisa Taylor claims she regularly buys one or two rotisserie chickens monthly from Costco, believing she overpaid due to undisclosed contamination risks, reflecting growing consumer concerns over food safety.
- Sales Data: Costco reported over 157 million rotisserie chickens sold worldwide in 2025 during its annual meeting last month, indicating strong market demand, but the lawsuit could undermine consumer confidence.
- Market Reaction: This lawsuit may negatively impact Costco's brand image and sales, particularly as consumer awareness of food safety increases, potentially leading to decreased sales and customer attrition.
See More
Amazon: The Smartest Growth Stock to Buy Now
- Attractive Valuation: Amazon's stock is currently trading at about 26.5 times the 2026 expected P/E ratio, significantly lower than valuations of traditional retailers like Walmart and Costco, making it one of the cheapest investment opportunities in its history and attracting investor interest.
- Operational Efficiency Gains: With over 1 million robots deployed in its distribution centers and coordinated by the DeepFleet AI model, Amazon has not only increased delivery speed but also significantly enhanced operational efficiency, driving sales growth.
- Advertising Revenue Surge: Amazon's high-margin sponsored ad business saw a 22% revenue increase last quarter, becoming a key driver of its operating income growth and further solidifying its leading position in the global digital advertising space.
- Cloud Computing Market Leadership: Holding the number one market share in cloud computing, Amazon's revenue growth reached 24% in Q4, the highest in over three years, indicating its commitment to invest $200 billion in capital expenditures to meet the booming demand for AI infrastructure.
See More
Costco Reports $66 Billion in Q1 Sales, Highlights Investment Potential
- Strong Sales Performance: Costco achieved net sales of $66 billion in the first quarter of fiscal 2026, reinforcing its leadership position in the global retail sector and further solidifying its market share.
- Attractive Investment Returns: With a total return of 193% over the past five years, Costco's stock has provided significant returns for investors, drawing increased attention from potential shareholders.
- Ongoing Expansion Plans: The management's strategy to open 25 to 30 new warehouses annually is expected to drive future revenue and profit growth, enhancing the company's competitive edge in the market.
- Cautious Investment Advice: While Costco is a high-quality business, its current price-to-earnings ratio of 52 indicates a high entry point, suggesting that investors should exercise patience and wait for a more favorable buying opportunity to ensure investment safety.
See More
Costco Reports $66 Billion in Q1 Sales for Fiscal 2026
- Sales Growth: Costco's net sales reached $66 billion in the first quarter of fiscal 2026, underscoring its leadership in the global retail sector, while providing investors with a total return of 193% over five years, reflecting strong market performance.
- Membership Expansion: With membership households now at 81 million and the company opening 25 to 30 new warehouses annually, Costco is poised for continued revenue and profit growth, enhancing its competitive position in the market.
- Investment Advice: Despite being a high-quality business, Costco's current price-to-earnings ratio of 52 indicates an expensive stock price with no margin of safety, suggesting that investors should be patient and wait for a more favorable entry point.
- Market Performance Comparison: Costco's total return of 193% contrasts sharply with the Motley Fool Stock Advisor's average return of 886%, highlighting the potential for higher returns in other stocks, prompting investors to consider diversifying their investment choices.
See More
Costco's Market Leadership and Investment Advice
- Strong Sales Performance: Costco reported net sales of $66 billion in the first quarter of fiscal 2026, underscoring its leadership in the global retail sector and continuing to attract investor interest.
- Significant Investment Returns: Over the past five years, Costco's stock has generated a total return of 193%, providing substantial gains for investors, although the current price-to-earnings ratio of 52 indicates a high entry cost.
- Ongoing Expansion Plans: The company plans to open 25 to 30 new warehouses each year, further solidifying its market share and driving future revenue and profit growth, demonstrating its strong business resilience.
- Caution for Investors: While Costco is an excellent company, its current high valuation suggests that new investors should exercise patience and wait for a more favorable entry point to mitigate risks.
See More
