Should You Buy Costco Stock Before Thursday's Q2 Earnings Report?

TLDR

Table of Contents

Costco’s Q2 fiscal 2026 earnings release is scheduled for March 5, 2026
Shares have climbed 13.6% year-to-date following a ~6% decline in 2025
Wall Street forecasts $4.55 in earnings per share versus $4.02 last year, with revenues projected at $69.25 billion
The Street maintains a Strong Buy rating with a mean price target of $1,081.57
The stock carries a forward P/E ratio of 49.6, significantly above the sector’s 18.9 average

The warehouse retail giant is approaching its second-quarter fiscal earnings announcement on March 5 with significant positive momentum.

Following a roughly 6% decline throughout 2025, Costco shares have staged an impressive comeback — climbing 13.6% in 2026 to date. This rebound has captured considerable attention from the investment community.

Costco Wholesale Corporation, COST

The Street anticipates earnings of $4.55 per share for the second quarter, representing growth from the $4.02 posted during the comparable period last year. Revenue projections stand at $69.25 billion, marking a 10% year-over-year expansion.

Recent sales figures heading into the earnings print have painted an optimistic picture. The company reported approximately $21 billion in net sales for January, representing a 9.3% increase compared to the prior year.

Throughout the initial 22 weeks of the current fiscal year, the retailer has posted 8.5% sales growth on a year-over-year basis. Comparable store sales have demonstrated consistent strength across different geographic markets.

The digital commerce channel has emerged as a particularly strong performer. Online sales have been expanding at double-digit rates, though any deceleration in this segment could trigger investor concern.

Membership expansion represents another critical metric worth monitoring. Growing membership rolls — partially fueled by inflation driving consumers toward value-oriented retailers — have provided consistent support. The company’s proprietary Kirkland Signature brand remains a key differentiator, fostering customer loyalty and helping maintain competitive positioning.

Analyst Views

Bank of America’s Christopher Nardone reaffirmed his Buy recommendation on COST before the earnings announcement and established a $1,185 price objective. His thesis emphasizes Costco’s broad demographic appeal — maintaining strength with affluent consumers while its value proposition attracts budget-conscious shoppers.

Citi analyst Steven Zaccone adopted a more reserved position, keeping his Hold rating while modestly lifting his price target from $990 to $1,000.

The overall Wall Street consensus stands at Strong Buy, supported by 19 Buy recommendations, four Hold ratings, and one Sell rating. The mean price objective of $1,081.57 suggests approximately 7% potential upside from present levels. The most bullish Street target reaches $1,205, implying nearly 20% appreciation potential.

The Valuation Question

Costco’s decade-long total return of 662% has outpaced the S&P 500 by more than two times. Revenue has expanded at a 9.3% compound annual growth rate across the past five years, with consistent year-over-year gains throughout that period.

This impressive performance comes with an elevated valuation. The stock currently commands a forward P/E multiple of 49.6, well above the sector’s 18.9 average. On a trailing basis, the P/E stands at 53.6 — approximately 15% higher than Nvidia’s valuation multiple.

For certain market participants, this premium valuation appears demanding. Any disappointment in comparable store sales metrics or weaker-than-expected membership growth could trigger a sharp selloff.

First quarter 2026 net sales reached $66 billion. The retailer’s operational model — purchasing substantial volumes of a curated product selection — provides significant supplier negotiating leverage and enables competitive consumer pricing.

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