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Costco closed fiscal 2026 with $303.2 billion in total revenue and diluted EPS of $20.76, up 14.0% for the year. At $924.59 a share, that puts the stock at roughly 44.5 times trailing earnings. The question this report actually asks is what that multiple is paying for: a business whose profit engine leans heavily on a 1.9%-of-revenue membership fee line with an 89.8% renewal rate, not on retail merchandise margins. Three frameworks below on the business itself, what the price assumes, and exactly how much of this year's growth was one-time versus recurring.
Costco operates 939 membership warehouses (647 in the U.S. and Puerto Rico, 115 in Canada, and 177 across 12 other countries, per the filed warehouse count) plus e-commerce sites in nine markets. Revenue splits into two lines: net merchandise sales of $297.247 billion (98.05% of total revenue) and membership fees of $5.907 billion (1.95%), both for the 52 weeks ended August 30, 2026. Merchandise sales carry thin retail margins by design; membership fees are close to pure profit and, structurally, are what makes the model work. Revenue quality on the membership side is unusually high: an 89.8% worldwide renewal rate and a 92.3% U.S. and Canada renewal rate, on 84.1 million paid memberships, up 3.8% for the year.
Comparable sales, broad-based. Total company comparable sales grew 8.4% for the fiscal year and 9.4% in the fourth quarter alone (6.6% and 6.7% respectively excluding gasoline-price and foreign-exchange effects). Growth was positive across all three reported geographies: U.S., Canada, and Other International.
Digital growth outpacing the core. Digitally-enabled comparable sales grew 20.9% for the fiscal year and 19.5% in the fourth quarter, more than double the total-company comparable-sales rate, with e-commerce site and app traffic up 30% in the quarter.
Membership mix shifting toward Executive. 42.3 million Executive memberships (the higher-fee tier) now account for 75.6% of sales penetration. Membership fee income grew 7.7% excluding foreign exchange, outpacing the 3.8% growth in total paid memberships, consistent with a mix shift toward the higher tier, more upgrades, or a fee increase; this filing does not break out which of those three is doing the most work.
Warehouse expansion continuing on a disclosed schedule. Costco opened 25 net new warehouses in fiscal 2026 (14 in the first three quarters, 11 in the fourth) and has disclosed an estimated 967 warehouses by the end of fiscal 2027, up from 939 at the fiscal 2026 close.
| Risk | Probability | Severity | Evidence |
|---|---|---|---|
| Merchandise cost pressure (tariffs, commodities) | Medium | Medium | Reported gross margin fell 11 basis points year over year this quarter; the filing discloses a one-time tariff-refund benefit that partially offset this, implying the underlying cost pressure is real and ongoing, not resolved. |
| Foreign-exchange and gasoline-price distortion of headline margins | Medium | Low to Medium | The same quarter's gross margin was down 11 basis points as reported but up 20 basis points excluding gasoline impact, a swing the company itself flags in the filing. |
| Membership renewal deceleration | Low, based on current data | High if it occurred | Renewal rates are currently strong (89.8% worldwide, 92.3% U.S. and Canada) and not flagged as declining in this filing, but the entire margin structure depends on sustaining them. |
| Competitive pressure in e-commerce and warehouse retail | Not named in this payload | Not named in this payload | No specific competitor is named in the retrieved filing text. |
| Warehouse expansion execution | Low | Low | 25 net openings in fiscal 2026 against a disclosed, specific fiscal 2027 target of 967 total; no execution shortfall is disclosed in this filing. |
Low to Moderate. The clearest, most filing-grounded watch item is the gap between reported and gasoline-adjusted gross margin, and whether the disclosed one-time tariff-refund benefit repeats or reverses in future quarters.
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Try free, card requiredAt $924.59 a share and 444.4 million diluted shares (the fiscal 2026 full-year weighted average stated in the filing), implied market capitalization is approximately $410.9 billion. Fiscal 2026 diluted EPS was $20.76, for a trailing multiple of roughly 44.5 times earnings, a snapshot consistent with the "43x" framing this report's companion video uses; the small difference reflects the live price moving since that figure was calculated.
The fourth quarter's headline diluted EPS grew 15.0% year over year, but the filing states this included a $0.15 per diluted share non-recurring benefit from IEEPA tariff refunds received in the quarter, net of partial reinvestment of those refunds into member value. Excluding that benefit, the company's own disclosure states net income grew 12.3% and EPS grew 12.4% for the quarter. This report treats 12.4%, not 15.0%, as the more sustainable underlying growth rate for the quarter; a full-year ex-item EPS dollar figure is not stated in this filing, only the quarterly growth-rate impact.
Fiscal 2026 operating cash flow was $15.825 billion against $6.435 billion of additions to property and equipment, for free cash flow of approximately $9.39 billion, up from capex of $5.498 billion the prior fiscal year. Against the $410.9 billion market capitalization above, that is a free cash flow yield of roughly 2.3%, consistent with a richly valued, high-quality compounder rather than a cheap stock by any conventional cash-flow screen.
These are modeled scenarios, not price targets and not a forecast of what the stock will do.
| Scenario | Key assumption | Basis |
|---|---|---|
| Bull | Comparable sales hold near the 8.4% FY2026 rate, membership fee growth continues outpacing membership count growth, multiple holds near current levels | Modeled off the FY2026 comp-sales and membership-fee growth rates as filed |
| Base | Comparable sales moderate toward the 6.6% ex-gas/FX adjusted FY2026 rate as digital growth matures, multiple compresses modestly toward historical staples-retailer averages | Modeled off the filed adjusted comp-sales figure |
| Bear | Tariff cost pressure resumes without offsetting refunds, gross margin reverts toward the reported (not ex-gas) -11 basis point trend, multiple re-rates toward broader consumer-staples peer levels | Modeled off the filed reported-margin figure and the one-time nature of this quarter's tariff-refund offset |
1. The 44.5x multiple assumes the membership-fee engine, not merchandise margin, keeps compounding. With merchandise carrying thin margins by design, a renewal-rate move away from 89.8% would disproportionately affect the earnings this multiple is priced against.
2. This quarter's headline growth rate is not the clean run rate. The 15.0% EPS growth figure includes a disclosed one-time benefit; the company's own 12.4% ex-item figure is the more durable comparison point for future quarters.
3. Gross margin optics depend on gasoline prices. The same quarter showed -11 basis points reported versus +20 basis points ex-gas, a 31 basis point swing driven by a factor unrelated to core retail execution.
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Try free, card requiredYes. The retrieved block contains a named revenue-line split (net sales versus membership fees) and a comparable-sales table decomposed by ticket and traffic, and by geography.
Total revenue for the 52 weeks ended August 30, 2026 was $303.154 billion, made up of net sales of $297.247 billion (98.05%) and membership fees of $5.907 billion (1.95%). Fourth-quarter comparable sales by geography, as filed: U.S. +10.7%, Canada +5.0%, Other International +7.0%, Total Company +9.4% (reported); adjusted for gasoline and foreign-exchange impact: U.S. +7.2%, Canada +4.6%, Other International +6.2%, Total Company +6.7%.
The filing explicitly separates a one-time item: fourth-quarter diluted EPS included a $0.15 per-share non-recurring benefit from IEEPA tariff refunds received in the quarter, net of partial reinvestment of those refunds into member value. Excluding this item, the filing states net income grew 12.3% and EPS grew 12.4% for the quarter, versus 14.9% and 15.0% as reported. No other one-time item is broken out with a dollar or per-share figure in this payload.
Growth in this filing is organic: driven by comparable sales and 25 net new warehouse openings in fiscal 2026 (14 in the first three quarters, 11 in the fourth). No acquisition is named in this payload as a driver of the reported results.
The filing's own comparable-sales table gives this split directly. Fourth-quarter Total Company comparable sales of +9.4% (reported) break down into Ticket +5.9% and Traffic +3.3%. Adjusted for gasoline and foreign-exchange impact, +6.7% breaks down into Ticket +3.3% and Traffic +3.3%.
A segment- or format-level profit breakdown (by warehouse geography or by ancillary businesses such as gas stations, pharmacy, or optical) is not in this filing. A full fiscal-year, rather than fourth-quarter-only, recurring-versus-one-time reconciliation is also not stated; the filing only quantifies the one-time tariff-refund impact for the quarter.
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