Costco Stock (COST) in December 2025: Special Dividend Odds, Tariff Fight and Wall Street Forecasts Before Earnings

As of December 8, 2025, Costco Wholesale Corporation (NASDAQ: COST) is trading just under the $900 mark, having cooled off after an explosive run in 2024. Despite strong sales and record membership income, the stock is slightly negative year‑to‑date while the S&P 500 has climbed mid‑teens, raising questions about valuation, growth catalysts, and the chances of another special dividend or even a stock split. ^[1]

Ahead of Costco’s fiscal first‑quarter 2026 earnings report on December 11, investors are also digesting a new lawsuit against the Trump administration over tariffs, an increasingly important e‑commerce story, and fresh Wall Street price targets that still point to double‑digit upside. ^[2]

1. Where Costco Stock Stands Today

Recent price data from MarketBeat and other trackers show Costco opening around $894–$895 per share on Monday, December 8, 2025, after drifting lower from highs above $1,070 earlier in the year. Over the last 12 months, the stock has traded in a range of roughly $871.71 to $1,078.23. ^[3]

Key snapshot metrics:

• Market capitalisation: about $397 billion
• Trailing P/E: ~49x FY 2025 earnings
• P/E/G ratio: ~6.1
• Dividend yield: ~0.6%, based on a $1.30 quarterly dividend ($5.20 annualised)
• Balance sheet: quick ratio 0.55, current ratio 1.03, debt‑to‑equity 0.20 ^[4]

Performance has been underwhelming in 2025 compared with 2024’s massive rally: 24/7 Wall St. notes that Costco shares are down a little over 2% year‑to‑date while the S&P 500 is up about 17%, marking one of the worst years of relative performance for Costco in more than two decades. ^[5]

For a stock that now trades at a premium P/E well above peers like Walmart and Target, that disconnect between fundamentals and price action is exactly what the market is debating. ^[6]

2. Fundamentals Look Strong: Q4 2025 Results and November Sales

If you only looked at Costco’s operating results, you might not guess the stock has been lagging the index.

Q4 and Full‑Year Fiscal 2025

In its fourth quarter and full‑year 2025 report, covering the 16‑week quarter and 52‑week year ended August 31, 2025, Costco posted: ^[7]

• Q4 net sales: $84.4 billion, up 8.0% year‑on‑year
• FY 2025 net sales: $269.9 billion, up 8.1%
• Q4 net income: $2.61 billion, or $5.87 EPS, up from $5.29 a year earlier
• FY 2025 net income: $8.10 billion, or $18.21 EPS, up from $16.56
• Comparable sales (Q4): +5.7% total company (+6.4% excluding fuel and FX)
• E‑commerce comps: +13.6% in Q4, +15.6% for the full year

The company ended the year with $14.2 billion in cash and cash equivalents, up from about $9.9 billion in 2024, plus over $1.1 billion in short‑term investments—fuel for dividends, special dividends, capex, or buybacks. ^[8]

November 2025 Sales: Solid Start to FY 2026

Costco’s November 2025 sales release shows that momentum has carried into the first quarter of fiscal 2026: ^[9]

• Net sales (4‑week November period): $23.64 billion, up 8.1% from a year ago
• Q1 net sales (12 weeks ended November 23): $65.98 billion, up 8.2%
• Comparable sales:
  • 4‑week November: +6.9% total company
  • 12‑week Q1: +6.4%
• Digitally enabled (e‑commerce and related) comps:
  • November: +16.6%
  • Q1 to date: +20.5%

The company now operates 921 warehouses worldwide, including 633 in the U.S. and Puerto Rico, 112 in Canada, and a growing footprint across Mexico, Asia, and Europe. ^[10]

Barron’s highlighted that November’s comp growth beat expectations of roughly 5.8%, with strength across categories like food, candy, fresh meat, bakery, jewellery, and health and beauty, while digital sales growth above 20% underscores Costco’s ongoing e‑commerce ramp. ^[11]

3. Membership Fees: The Engine Behind Costco’s Profit Machine

Costco’s real secret sauce is its membership model, and 2025 numbers show that engine still running hot—even after a fee increase.

A recent Nasdaq/Zacks analysis notes that in Q4 FY 2025: ^[12]

• Membership fee income jumped 14% to $1.724 billion.
• About half of that growth came from last year’s membership fee hike in the U.S. and Canada ($5 more for standard and $10 more for Executive).
• Even excluding fee hikes and FX, membership income rose around 7%, pointing to real underlying strength.
• Paid memberships increased 6.3% to 81 million.
• Executive members grew 9.3% to 38.7 million, now representing 47.7% of paid members but 74.2% of global sales.

There was one yellow flag: global renewal rates slipped slightly, from roughly 90.2% to 89.8%, while the U.S. and Canada renewal rate edged down 40 basis points to 92.3%. Management blamed a surge in online sign‑ups, including promotions like a large Groupon campaign, which tend to have lower early renewal. ^[13]

To shore up retention—especially among younger members, who now account for nearly half of new sign‑ups—Costco is: ^[14]

• Pushing auto‑renewal more aggressively
• Enhancing digital communication and app engagement
• Adding perks like extended warehouse hours and a $10 monthly Instacart credit for Executive members

Zacks expects membership fees to grow another ~9% in fiscal 2026 after double‑digit growth in 2025, keeping this high‑margin revenue stream on an upward trajectory. ^[15]

4. New Tariff Lawsuit: A Big Macro Wildcard

On December 2, The Guardian reported that Costco has sued the Trump administration in the U.S. Court of International Trade, challenging tariffs imposed under the International Emergency Economic Powers Act (IEEPA). ^[16]

Key points from the lawsuit:

• Costco argues the White House misused emergency powers: IEEPA is meant for national security threats, and the law doesn’t even mention tariffs.
• The retailer is asking the court to halt “liquidation”—the finalisation of tariff assessments by U.S. Customs and Border Protection—because once tariffs are “liquidated,” importers may have no clear right to refunds, even if the Supreme Court later rules the tariffs unlawful.
• Tariff collections surged to $195 billion in FY 2025, up from $118 billion the year before. Costco hasn’t disclosed its exact bill, but about one‑third of its U.S. sales come from imports, nearly half from China, Mexico, and Canada. ^[17]

For Costco shareholders, the case cuts both ways:

• Risk: A prolonged tariff regime pressures gross margins and pricing, especially in categories where Costco competes on razor‑thin margins.
• Potential upside: If the Supreme Court and trade courts eventually side with importers, Costco could be in line for meaningful tariff refunds, effectively a one‑time boost to cash and possibly to shareholder returns.

Investors should listen closely on the December 11 call for any update on how tariffs are affecting costs, pricing, and sourcing strategies.

5. Special Dividend or Stock Split? Hype vs. Reality

Because Costco has a history of huge special dividends, any build‑up of cash on the balance sheet immediately sparks speculation.

A History of Big Payouts

Costco has periodically rewarded shareholders with large special dividends on top of its regular quarterly payout, including: ^[18]

• $15 per share in December 2023
• $10 per share in November 2020
• $7 per share in 2017
• Earlier specials in 2015 and 2012

With over $14 billion in cash and modest net debt, Costco clearly could afford another special distribution if it wished. ^[19]

Why a 2025 Special Dividend Looks Unlikely

However, a December 8 analysis from 24/7 Wall St. concludes that a special dividend at the December 11 earnings date is unlikely, for three main reasons: ^[20]

1. Underwhelming stock performance
   • Costco shares are down just over 2% in 2025, while the S&P 500 is up about 17%, a sharp contrast to 2024 when Costco far outpaced the index.
2. Slowing comparable sales growth
   • Q4 2025 comps were strong but decelerated from earlier peaks, and November’s 6.4–6.9% comp growth, while solid, is no longer in the double‑digit range that accompanied past specials.
3. Premium valuation leaves less room for “victory laps”
   • With a trailing P/E near 49x and forward expectations for high‑single to low‑double‑digit EPS growth, a cash‑heavy special dividend might send mixed signals about growth versus capital return. ^[21]

Analysts at Seeking Alpha and other outlets have also floated the possibility of a stock split, noting that Costco hasn’t split shares since a 2‑for‑1 split in 2000, and the triple‑digit price tag may eventually become an optics issue. But there is no indication from management that a split is imminent. ^[22]

Bottom line: The odds favour no special dividend or split in December, though Costco’s balance sheet and past behaviour keep the door open for future events if performance re‑accelerates.

6. Earnings Preview: What Wall Street Expects on December 11

For the fiscal first quarter 2026 report due on December 11, consensus estimates compiled by 24/7 Wall St. and other data providers call for: ^[23]

• Earnings per share (EPS): about $4.27, up roughly 11% year‑on‑year
• Revenue: around $67.15 billion, up about 8%

Those figures build directly on the preliminary Q1 sales data Costco has already released: an ~8.2% sales increase for the 12‑week period and comps of 6.4%, with digitally enabled sales rising more than 20%. ^[24]

On the Q4 call, management highlighted plans for about 35 new warehouse openings in fiscal 2026, including relocations, as a key driver of continued membership and revenue growth, alongside ongoing strength in e‑commerce and international markets. ^[25]

Investors will be laser‑focused on:

• Comp sales by region (U.S. vs. international)
• E‑commerce and “big and bulky” categories
• Membership fee growth and renewal rates
• Any updated guidance for FY 2026 revenue and EPS
• Commentary on tariffs and pricing power

Any sign of further comp deceleration or weaker traffic, particularly in higher‑ticket discretionary categories, could weigh on the shares given the rich multiple.

7. Analyst Ratings, Valuation Models and Long‑Term Price Targets

Despite the stock’s choppier 2025 performance, Wall Street is still broadly bullish on Costco.

Street Consensus: “Moderate Buy” / “Buy”

• MarketBeat reports 32 analysts covering Costco with a “Moderate Buy” consensus:
  • 19 Buy ratings, 13 Hold, 0 Sell
  • Average 12‑month price target:$1,023.41, about 14% upside from roughly $895
  • Target range: $16 (an obvious outlier) to $1,418 ^[26]
• StockAnalysis.com aggregates 23 analysts with a “Buy” consensus:
  • Average price target:$1,071 (around 20% upside)
  • Range: $907–$1,225
  • Forecasts revenue rising to about $302.7 billion in FY 2026 (+10%) and $325.6 billion in FY 2027 (+7.6%), with EPS projected to climb from $18.21 (FY 2025) to roughly $20.48 in FY 2026 and $22.57 in FY 2027. ^[27]

Independent Valuation Views

• Simply Wall St’s narrative model pins Costco’s fair value at about $1,055.97, implying the shares are ~15% undervalued at ~$895. Their analysis also notes: ^[28]
  • A consensus Street target around $1,070+
  • A 49x P/E versus roughly 22x for the broader U.S. consumer retailing industry
  • A caution that Costco’s premium multiple could compress toward a more “reasonable” mid‑30s P/E if sentiment cools.
• A separate 24/7 Wall St. long‑term price‑target model looks out to 2030, projecting: ^[29]
  • Median one‑year Street target: $1,091.61 (~22% upside)
  • The author’s 2025 year‑end target: $1,013.41 (about 13% upside)
  • A potential 2030 price of $1,599.54, assuming EPS around $27.70 and a P/E of 37x

Even the sceptical takes generally focus on valuation risk, not business fragility—Costco rarely earns “Sell” ratings.

8. Institutional and Insider Activity

Recent 13F filings and news show an active but balanced institutional backdrop: ^[30]

• Ossiam boosted its Costco position by 229% in Q2, to over 69,000 shares worth roughly $68.4 million, making it the firm’s 22nd‑largest holding.
• Other institutions such as Bank of Nova Scotia and Cerity Partners have also added to positions.
• A separate MarketBeat item notes SVB Wealth LLC trimmed its stake by about 20%, selling nearly 4,000 shares and holding around 15,600 shares afterwards.
• Overall, about 68.5% of Costco’s stock is owned by institutional investors.

Insiders have been net sellers over the past quarter, unloading about 9,700 shares (roughly $9 million worth), including sales from two executive vice presidents at prices near $915–$936. Insider ownership remains low at around 0.18%. ^[31]

Given Costco’s large‑cap status and high price per share, occasional insider sales and portfolio rebalancing by institutions are not unusual, but they are worth monitoring in context of valuation concerns.

9. Costco vs. Walmart: Different Plays on the Consumer

A fresh 24/7 Wall St. comparison piece underscores how Costco and Walmart are now two very different bets on the global consumer. ^[32]

Highlights:

• E‑commerce growth:
  • Walmart’s digital business grew 27% in its latest quarter.
  • Costco’s e‑commerce grew 13.6% in its Q4, and around 20% including digitally enabled sales in Q1.
• Net income growth:
  • Walmart: +33% year‑on‑year
  • Costco: +10.9% in Q4 2025
• Valuation:
  • Walmart trades near 40x earnings
  • Costco trades closer to 49x

The author leans toward Walmart for growth investors, citing faster digital growth at a lower multiple, and positions Costco as the more defensive, “boring but solid” choice for investors prioritising stability and the membership model.

For Costco shareholders, the takeaway is that the bar is high: with a P/E premium over even a resurgent Walmart, the company must keep delivering consistent mid‑single‑digit to high‑single‑digit comp growth, expanding e‑commerce, and strong membership economics to justify its valuation.

10. Bull Case vs. Bear Case for Costco Stock

Bull Case: Why Long‑Term Investors Still Love COST

Supporters of Costco can point to a long list of structural positives:

• Membership moat: High renewal rates near 90% worldwide and over 92% in the U.S. and Canada create recurring, high‑margin revenue and habitual shopping behaviour. ^[33]
• Consistent comps: Multi‑year streak of positive comparable sales growth, with FY 2025 comps still in the mid‑single digits despite macro headwinds. ^[34]
• E‑commerce catch‑up: Digital sales growing in the mid‑teens to 20% range, off a still‑modest base, leaving room for further upside. ^[35]
• Global expansion runway: 921 warehouses and counting, with management planning dozens of new clubs annually, especially internationally. ^[36]
• Rock‑solid balance sheet: Low leverage and a large cash pile give Costco the flexibility to keep raising its regular dividend, consider future specials, and invest aggressively in logistics and technology. ^[37]
• Long‑term compounding record: Over the past decade, revenues and EPS have compounded at high‑single to mid‑teen rates, and the stock has dramatically outperformed the market. ^[38]

Bear Case: Valuation, Tariffs and Macro Headwinds

Critics counter that great business ≠ great stock at any price:

• Rich valuation: A near‑50x trailing P/E and mid‑40s forward P/E are high even for a quality retailer and leave little margin of safety if growth slows. ^[39]
• Growth vs. multiple mismatch: Articles like “3 Reasons Costco Stock Is Struggling” (syndicated by Nasdaq/AOL) argue that mid‑single‑digit comp growth and high‑single‑digit EPS growth may not justify such a premium, especially when tech and other sectors offer faster growth at lower multiples. ^[40]
• Few near‑term catalysts: With a fee hike already in the rear‑view, a special dividend unlikely this quarter, and no announced stock split, some investors see a lack of obvious upside triggers in 2025–2026. ^[41]
• Tariff uncertainty: The IEEPA lawsuit highlights how exposed Costco is to trade policy; prolonged or higher tariffs could squeeze margins or force unwelcome price hikes. ^[42]
• Rival momentum: Walmart is accelerating e‑commerce at nearly double Costco’s rate and trades at a lower multiple, while BJ’s and Sam’s Club continue to refine their own membership propositions. ^[43]

11. Key Things to Watch on December 11

For investors following Costco stock around the upcoming Q1 FY 2026 earnings, the most important metrics and themes to monitor include:

1. Comp sales by region and category
   • Are U.S. comps stabilising, improving, or softening further?
   • How are big‑ticket categories (electronics, appliances) vs. staples (food, household essentials) performing?
2. Digital and “big & bulky” growth
   • Does digitally enabled sales growth stay around 20%+?
   • Are investments in last‑mile delivery and big/bulky categories (e.g., furniture, appliances) driving incremental share? ^[44]
3. Membership renewal and fee trends
   • Do renewal rates recover from the recent dip?
   • Are younger members sticking around after promotional periods end? ^[45]
4. Tariff commentary
   • Any incremental disclosure about tariff impacts, the litigation strategy, or potential refund scenarios?
5. Capital allocation hints
   • Any discussion of the long‑term approach to special dividends, buybacks, or a possible stock split?

A solid beat and reassuring commentary might help re‑ignite Costco’s premium narrative; conversely, any disappointment on comps or forward guidance could prompt another round of valuation‑driven selling.

12. Bottom Line: A World‑Class Business at a Premium Price

Costco enters its December 11 earnings report with:

• Excellent fundamentals — strong sales growth, robust membership economics, rising digital penetration, and a fortress balance sheet. ^[46]
• Real macro and policy risks — from tariffs and inflation‑sensitive consumers to intense competition from Walmart and other warehouse clubs. ^[47]
• A valuation that assumes very little can go wrong — a P/E in the high‑40s and most analyst targets only 15–20% above the current price. ^[48]

For long‑term, patient investors, Costco remains one of the cleanest, most durable retail stories in the market. For valuation‑sensitive traders, it’s also a textbook example of a wonderful business that may already be priced like one.

References

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