Is Costco Stock Priced Too High or Too Low?
Costco's Financial Performance: Costco reported its quarterly financial results, easing concerns among investors, with stock prices noted as of September 24, 2025.
Investment Recommendations: The Motley Fool's Stock Advisor identified 10 top stocks for investment, excluding Costco, highlighting past successes with companies like Netflix and Nvidia that yielded significant returns.
Stock Advisor Performance: The Stock Advisor boasts an average return of 1,062%, significantly outperforming the S&P 500's 189% return, encouraging potential investors to consider their latest recommendations.
Disclosure and Affiliations: Parkev Tatevosian, a CFA and affiliate of The Motley Fool, has no positions in the mentioned stocks, but The Motley Fool recommends Costco and may benefit from subscriptions through his link.
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Costco's Revenue Continues to Climb
- Revenue Growth Drivers: Costco is expected to continue its revenue growth through new warehouse openings and same-store sales increases, with a 6.4% rise in same-store sales in Q1 FY2026 and an additional 7% in December, indicating strong market demand.
- Strong Market Position: With a current market cap of $434 billion and a 170% stock price increase over the past five years, Costco holds a dominant position in the retail sector, poised for further market share expansion in the next five years.
- Membership Growth Support: The company adds new membership accounts each quarter, driving spending activity, with net income climbing 102% from FY2020 to FY2025, reflecting increased customer loyalty and spending potential.
- Valuation Pressure: Despite strong fundamentals, Costco's high price-to-earnings ratio of 52.7—almost double that of the S&P 500—may lead to valuation corrections over the next five years, potentially impacting stock performance.

Costco's Stock Up 170% in Five Years, Eyes Future Growth
- Strong Market Performance: Costco's stock has surged 170% over the past five years, reaching a market cap of $434 billion, reflecting its robust competitiveness in the retail sector and investor confidence.
- Sustained Growth Potential: Management plans to open 25 to 30 new warehouses annually, indicating that the company is set to expand its footprint in both the U.S. and international markets, thereby driving revenue growth in the coming years.
- Same-Store Sales Growth: In the first quarter of fiscal 2026, same-store sales increased by 6.4%, with a further rise of 7% in December, demonstrating strong business resilience even amid declining consumer confidence.
- Potential for Trillion-Dollar Club: Costco's market cap needs to rise by 129% by 2031; while it has grown 172% in the past five years, its high price-to-earnings ratio of 52.7 may pressure future growth, making a ten-year timeline for this milestone more realistic.






