Costco Stock Stalls: Is This the Real Signal?

Costco Wholesale's stock has traded sideways for the past year, currently around $917 per share. This stagnation occurred despite a robust fiscal fourth quarter of 2026, which concluded on August 30, 2026, reporting a 9.4% comparable sales increase and a 15% rise in earnings per share to $6.75. The company is set to release its September sales figures on Wednesday, October 7, marking the first month of fiscal year 2027.

While headline comparable sales include gasoline, which boosted recent figures, the critical metric to watch is adjusted comparable sales, excluding gas and currency fluctuations. This adjusted figure has shown a decelerating trend, falling from 8% in May to an estimated 6% to 6.6% in subsequent months. Although August's figure was slightly impacted by a calendar shift, the underlying trend indicates a slowdown.

Further analysis reveals that while member traffic increased by 3.3% in the fiscal fourth quarter, up from 2.4% in the prior quarter, the average transaction value grew at a slower pace. Excluding gas and currency, spending per trip increased by 3.3%, down from 4.2% in the previous quarter. This suggests members are shopping more frequently but spending less per visit.

Despite the stock's pullback from its May peak, its valuation remains a concern. At approximately $917 per share, Costco trades at about 44 times its fiscal 2026 earnings. While this is down from a previous multiple of 50 times earnings, the current price is considered high for the company's low-teens growth rate. Even with the increase in member traffic, the stock is viewed as potentially overvalued until further evidence of sustained sales momentum emerges.