Costco Plans to Open 28 New Stores in 2026, Each Averaging $192 Million in Sales
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 28 2025
0mins
Should l Buy COST?
Source: Yahoo Finance
- Significant Membership Growth: Costco's membership base increased by 5.2% year-over-year to 81.4 million, demonstrating its strong customer loyalty and appeal in a competitive retail landscape.
- Sales Continue to Climb: In Q1 2026, Costco reported net sales of $65.98 billion, an 8.2% increase year-over-year, reflecting its ability to achieve stable growth amid economic uncertainty.
- New Store Opening Plans: The company plans to open 28 new stores in fiscal year 2026, which is significant given that newly opened stores averaged $192 million in sales last year, further enhancing its market share and profitability.
- Increased Shareholder Returns: Costco repurchased $2.18 billion of common stock in fiscal year 2025, demonstrating its commitment to shareholders while also laying the groundwork for future dividend growth.
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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: 1011.700
Low
769.00
Averages
1061
High
1205
Current: 1011.700
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 Introduces Bottled Water Option in Hot Dog Combo
- Menu Change: Costco has made its first adjustment to the iconic $1.50 hot dog combo in over 40 years by allowing customers to choose a 16.9-ounce Kirkland bottled water instead of a 20-ounce soda, reflecting a growing demand for healthier options among consumers.
- Positive Customer Reaction: Social media feedback indicates that many customers prefer bottled water over soda, which not only enhances customer loyalty but may also attract more health-conscious shoppers to the store.
- Profit vs. Traffic Balance: Despite incurring nearly $300 million in losses annually from the hot dog deal, Costco views this pricing strategy as crucial for driving store traffic and membership renewals, ultimately enhancing brand equity in the long run.
- Historical Commitment: Since its introduction in 1984, the hot dog combo has become a hallmark of the Costco shopping experience, with management pledging to maintain the $1.50 price, underscoring the company's dedication to customer trust and perceived value.
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Costco Shareholders Receive Significant Dividend Increase
- Dividend Growth: Costco has announced a 13% increase in its dividend, consistent with the 12% average annual growth over the past decade, demonstrating the company's commitment to shareholder returns and attracting dividend growth investors.
- Revenue Structure Analysis: For the first half of fiscal 2026, Costco generated revenues of $136.9 billion, with membership fees making up less than 2% but contributing nearly $2.7 billion in income, highlighting the importance of its membership model to profitability.
- Membership Renewal Rate: The global membership renewal rate stood at 89.7% in Q2 of fiscal 2026, down from 90.5% in the same quarter last year, yet still indicating customer satisfaction with the Costco shopping experience and reflecting the stability of its business model.
- Market Competitive Advantage: Costco's reliance on membership fees allows it to be more aggressive with product pricing, maintaining lower margins despite rising costs from geopolitical tensions, thereby supporting long-term growth.
See More
Costco Announces 13% Dividend Increase, Reflecting Strong Financial Health
- Significant Dividend Increase: Costco has announced a 13% increase in its dividend, aligning with the average annual growth rate of 12% over the past decade, demonstrating the company's ongoing profitability and commitment to shareholder returns.
- Revenue Structure Insight: In the first half of fiscal 2026, Costco generated $136.9 billion in revenue, with membership fees making up less than 2% but contributing nearly $2.7 billion to income, which exceeds half of the company's gross profit, highlighting the profitability potential of its membership model.
- Stable Membership Renewal Rate: Although the global membership renewal rate was 89.7% in Q2 of fiscal 2026, down from 90.5% in the same quarter of 2025, it still indicates customer satisfaction with the Costco shopping experience, reflecting the resilience of its business model.
- Market Valuation Considerations: Costco's price-to-earnings ratio stands at 51x, significantly higher than the retail industry's average of 18x, and with a dividend yield of only 0.6%, investors should carefully assess the risks associated with its high valuation.
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Investment Comparison: Walmart vs. Costco
- Walmart's Market Advantage: With over 5,000 locations in the U.S. covering 90% of the population, Walmart leverages its stores as e-commerce distribution centers, achieving a 24% growth in e-commerce in Q4 2026, showcasing its competitive edge.
- Commitment of a Dividend King: Walmart has raised its dividend for 53 consecutive years, currently yielding 0.74%, providing shareholders with stable returns while increasing its market share among high-income households.
- Costco's Membership Loyalty: Costco boasts a renewal rate of 92.1% in the U.S. and Canada, and 89.7% globally, with executive members accounting for 76% of total sales, reflecting its efficient business model and strong customer retention.
- E-commerce Sales Growth: Costco's e-commerce sales increased by 24% year-over-year in Q2, with total sales up 9.1%, indicating that its investments in a tech-driven market are paying off, promising continued returns for shareholders.
See More
Analysis of Competitive Advantages Between Walmart and Costco
- Customer Base Expansion: Walmart has successfully expanded its market share by attracting higher-income customers earning over $100,000, demonstrating strong resilience during economic downturns, which enhances its competitive position in the retail market.
- Significant E-commerce Growth: Walmart's e-commerce business grew by 24% year-over-year in the fiscal fourth quarter of 2026, leveraging its stores as e-commerce distribution centers to enhance customer responsiveness and drive overall sales growth, showcasing its success in digital transformation.
- High Membership Renewal Rates: Costco achieved a membership renewal rate of 92.1% in the second quarter of 2026, with an increasing number of members upgrading to executive memberships that cost double, which not only boosts customer loyalty but also means executive members account for 76% of total sales, further solidifying its market position.
- Stable Dividend Yields: As a
See More
Walmart: A Model for Long-Term Investment
- Outstanding Stock Performance: Walmart's stock has risen approximately 3,240% over the past 30 years, significantly outperforming the S&P 500's 916% gain, demonstrating its reliability and stability as a long-term investment.
- Consistent Dividend Growth: Walmart has raised its dividend for 53 consecutive years, earning the title of 'Dividend King', maintaining this record even during economic turmoil, which reflects its strong cash flow and profitability.
- E-commerce and Market Expansion: Walmart effectively counters Amazon's competition by expanding its e-commerce marketplace, upgrading delivery services, and launching the Walmart+ subscription service, with future growth expected from its e-commerce and advertising segments.
- Future Growth Expectations: Analysts project that from fiscal 2026 to 2029, Walmart's revenue and EPS will grow at CAGRs of 5% and 10%, respectively, indicating its long-term growth potential in the retail sector.
See More
Costco Introduces Bottled Water Option in Hot Dog Combo
- Menu Change: Costco has made its first adjustment to the iconic $1.50 hot dog combo in over 40 years by allowing customers to choose a 16.9-ounce Kirkland bottled water instead of a 20-ounce soda, reflecting a growing demand for healthier options among consumers.
- Positive Customer Reaction: Social media feedback indicates that many customers prefer bottled water over soda, which not only enhances customer loyalty but may also attract more health-conscious shoppers to the store.
- Profit vs. Traffic Balance: Despite incurring nearly $300 million in losses annually from the hot dog deal, Costco views this pricing strategy as crucial for driving store traffic and membership renewals, ultimately enhancing brand equity in the long run.
- Historical Commitment: Since its introduction in 1984, the hot dog combo has become a hallmark of the Costco shopping experience, with management pledging to maintain the $1.50 price, underscoring the company's dedication to customer trust and perceived value.
See More
Costco Shareholders Receive Significant Dividend Increase
- Dividend Growth: Costco has announced a 13% increase in its dividend, consistent with the 12% average annual growth over the past decade, demonstrating the company's commitment to shareholder returns and attracting dividend growth investors.
- Revenue Structure Analysis: For the first half of fiscal 2026, Costco generated revenues of $136.9 billion, with membership fees making up less than 2% but contributing nearly $2.7 billion in income, highlighting the importance of its membership model to profitability.
- Membership Renewal Rate: The global membership renewal rate stood at 89.7% in Q2 of fiscal 2026, down from 90.5% in the same quarter last year, yet still indicating customer satisfaction with the Costco shopping experience and reflecting the stability of its business model.
- Market Competitive Advantage: Costco's reliance on membership fees allows it to be more aggressive with product pricing, maintaining lower margins despite rising costs from geopolitical tensions, thereby supporting long-term growth.
See More
Costco Announces 13% Dividend Increase, Reflecting Strong Financial Health
- Significant Dividend Increase: Costco has announced a 13% increase in its dividend, aligning with the average annual growth rate of 12% over the past decade, demonstrating the company's ongoing profitability and commitment to shareholder returns.
- Revenue Structure Insight: In the first half of fiscal 2026, Costco generated $136.9 billion in revenue, with membership fees making up less than 2% but contributing nearly $2.7 billion to income, which exceeds half of the company's gross profit, highlighting the profitability potential of its membership model.
- Stable Membership Renewal Rate: Although the global membership renewal rate was 89.7% in Q2 of fiscal 2026, down from 90.5% in the same quarter of 2025, it still indicates customer satisfaction with the Costco shopping experience, reflecting the resilience of its business model.
- Market Valuation Considerations: Costco's price-to-earnings ratio stands at 51x, significantly higher than the retail industry's average of 18x, and with a dividend yield of only 0.6%, investors should carefully assess the risks associated with its high valuation.
See More
Investment Comparison: Walmart vs. Costco
- Walmart's Market Advantage: With over 5,000 locations in the U.S. covering 90% of the population, Walmart leverages its stores as e-commerce distribution centers, achieving a 24% growth in e-commerce in Q4 2026, showcasing its competitive edge.
- Commitment of a Dividend King: Walmart has raised its dividend for 53 consecutive years, currently yielding 0.74%, providing shareholders with stable returns while increasing its market share among high-income households.
- Costco's Membership Loyalty: Costco boasts a renewal rate of 92.1% in the U.S. and Canada, and 89.7% globally, with executive members accounting for 76% of total sales, reflecting its efficient business model and strong customer retention.
- E-commerce Sales Growth: Costco's e-commerce sales increased by 24% year-over-year in Q2, with total sales up 9.1%, indicating that its investments in a tech-driven market are paying off, promising continued returns for shareholders.
See More
Analysis of Competitive Advantages Between Walmart and Costco
- Customer Base Expansion: Walmart has successfully expanded its market share by attracting higher-income customers earning over $100,000, demonstrating strong resilience during economic downturns, which enhances its competitive position in the retail market.
- Significant E-commerce Growth: Walmart's e-commerce business grew by 24% year-over-year in the fiscal fourth quarter of 2026, leveraging its stores as e-commerce distribution centers to enhance customer responsiveness and drive overall sales growth, showcasing its success in digital transformation.
- High Membership Renewal Rates: Costco achieved a membership renewal rate of 92.1% in the second quarter of 2026, with an increasing number of members upgrading to executive memberships that cost double, which not only boosts customer loyalty but also means executive members account for 76% of total sales, further solidifying its market position.
- Stable Dividend Yields: As a
See More
Walmart: A Model for Long-Term Investment
- Outstanding Stock Performance: Walmart's stock has risen approximately 3,240% over the past 30 years, significantly outperforming the S&P 500's 916% gain, demonstrating its reliability and stability as a long-term investment.
- Consistent Dividend Growth: Walmart has raised its dividend for 53 consecutive years, earning the title of 'Dividend King', maintaining this record even during economic turmoil, which reflects its strong cash flow and profitability.
- E-commerce and Market Expansion: Walmart effectively counters Amazon's competition by expanding its e-commerce marketplace, upgrading delivery services, and launching the Walmart+ subscription service, with future growth expected from its e-commerce and advertising segments.
- Future Growth Expectations: Analysts project that from fiscal 2026 to 2029, Walmart's revenue and EPS will grow at CAGRs of 5% and 10%, respectively, indicating its long-term growth potential in the retail sector.
See More
