Costco stock price will be in focus this week as it publishes its financial results, which will provide more color on its performance and impact on tariffs. COST share price was trading at $1,000, down a bit from its all-time high of $1,075.
This article explores what to expect when Costco releases its financial results, and why a risky chart pattern points to a dive.
Costco’s business is doing well
Costco Wholesale Corporation will be the biggest retailer to publish its financial results this week. Its other competitors, like Walmart, Home Depot, and Target published theirs recently and warned that they would increase prices to deal with Trump’s tariffs.
Read more: Walmart to pass on tariff burden to shoppers, braces for margin volatility
Costco’s business has been thriving in the past few years, with its annual revenues rising from $166 billion in 2020 to over $264 billion in the trailing twelve months (TTM).
This increase happened because of the rising demand for its products and membership price increases.
It has also become a highly profitable company, with its annual profit rising from $4 billion to $7.62 billion in the same period.
The most recent numbers showed that Costco’s net sales jumped by 9.1% in Q2’25 to $62.5 billion. The closely-watched comparable sales data rose by 6.8%, with the e-commerce section rising by 20.9%.
Costco is still adding more members, with the growth rate coming in at 7.4% and the renewal rate rising to 90.5% despite the price increase. Customers are always ready to pay for Costco’s subscriptions because of the value they get.
Read more: 2 reasons why the Costco stock price has collapsed this year
Unlike other companies, Costco makes most of its profits from the membership fees instead of its merchandise. It even barely breaks even on some of its products.
This business model helps it get more members. Also, because of its scale, the business model helps it negotiate better pricing with suppliers, especially now that tariffs are affecting most products.
COST earnings and valuation
The average estimate is that Costco’s revenue will be $63.1 billion, representing a 7.83% annual growth rate. Its forward guidance for the next quarter will be $85.5 billion, also representing a 7.2% growth rate.
If this trend continues, the company will then make $274 billion in its financial year, followed by $294 billion next year. The quarterly earnings per share is expected to rise from $3.78 to $4.23.
A key concern that Costco has always had is its valuation, which is one of the most stretched in the retail industry. The company, despite its low-margin business, has a forward price-to-earnings ratio of 55, higher than the sector median of 18. It is also higher than other popular companies like Microsoft and Google.
Costco stock price analysis
The daily chart shows that the COST stock price has rebounded after bottoming at $870 in April this year. This rebound has mirrored that of other companies in Wall Street.
The risk, however, is that the Costco share price has formed a rising wedge chart pattern, a popular bearish reversal sign. This pattern happens when there are two ascending and converging trendlines, with the bearish breakout happening when they converge.
Therefore, there is a risk that the Costco stock price will have a bearish breakdown after earnings. If this happens, the next point to watch will be at $950.
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