By Peet Serfontein & Motheo Tlhagale
Costco Wholesale Corporation is a membership warehouse club that sells a variety of food, automotive supplies, toys, hardware, sporting goods, jewellery, electronics, apparel, health, and beauty aids, as well as other goods with a robust international footprint. The company serves customers through its warehouses and e-commerce sites.
Founded in 1983, the company has grown into one of the world's largest retailers, offering a limited selection of bulk, high-quality products - both well-known brands and its private label, Kirkland Signature, at attractive prices through tight markup controls and efficient operations.
Technically, a steady and rising Volume Price Trend (VPT) supports a bullish outlook for the stock (see insert). A VPT that rises in tandem with the share price suggests that upward movements are underpinned by strong trading volumes, an indication of solid demand and investor conviction. This is a key signal, as price trends supported by volume are typically more sustainable than those driven solely by price action.
The stock has a strong track record of outperforming in the fourth quarter, supported by seasonal demand and upbeat investor sentiment. Since 2000, average monthly returns show a clear pattern, with October and November posting solid gains of +3.5% and +3.6%, driven by key retail periods like back-to-school, holiday shopping, and year-end spending. Even December, with a more modest +0.7% return, adds to the seasonal strength. This consistent performance points to institutional confidence and gives investors a solid, data-backed reason for a bullish view heading into year-end.
| Share Information | |
|---|---|
| Share Code | COST |
| Industry | Consumer Staples and Distribution |
| Market Capital (USD) | 434.27 billion |
| One Year Total Return | 10.06% |
| Return Year-to-Date | 7.28% |
| Current Price (USD) | 979.25 |
| 52 Week High (USD) | 1 078.24 |
| 52 Week Low (USD) | 867.16 |
| Financial Year End | September |
| The price is oscillating around the 200-day simple moving average (SMA). | |
| Consensus Expectations (Bloomberg) | ||||
|---|---|---|---|---|
| FY24 | FY25E | FY26E | FY27E | |
| Headline Earnings per Share (USD) | 16.56 | 18.13 | 20.02 | 22.06 |
| Growth (%) | 9.49 | 10.43 | 10.17 | |
| Dividend Per Share (USD) | 19.36 | 4.72 | 5.31 | 7.13 |
| Growth (%) | -75.61 | 12.45 | 34.34 | |
| Forward PE (times) | 54.01 | 48.90 | 44.39 | |
| Forward Dividend Yield (%) | 0.48 | 0.54 | 0.73 | |
| Medium-term growth prospects remain positive. | ||||
Buy/Sell Rationale:
Technical Analysis:
Fundamental view
| Share Name and Position | KMI - Buy (Continue to hold) |
ADTN - Buy (Continue to hold) |
BMY - Buy (Continue to hold) |
|---|---|---|---|
| Entry | 26.74 | 9.28 | 48.34 |
| Current Price | 26.64 | 10.37 | 47.23 |
| Movement | -0.4% | +11.7% | -2.3% |
| Comment | This price is in an uptrend with AI support, though still below the 200-day SMA, making it a counter-trend setup. Downside momentum has halted, supporting the strategy. Our profit target remains $30.00, with a trailing stop at $25.30. | The price is holding near active ranges and remains above the 200-day SMA, with upside momentum supporting the trade. Our target remains $11.50 with a trailing stop at $9.20. | A Bollinger Bands buy signal has emerged, though the price remains below the 200-day SMA, making this a counter-trend setup. Upside momentum supports the trade. Our target is $56.00 with a $45.20 trailing stop. |
| Time to exit | 07 November 2025 | 22 December 2025 | 12 November 2025 |
| Share Name and Position | SYK - Buy (Continue to hold) |
ADP - Buy (Continue to hold) |
MCD - Buy (Continue to hold) |
|---|---|---|---|
| Entry | 380.86 | 308.64 | 299.17 |
| Current Price | 392.76 | 297.24 | 312.52 |
| Movement | +3.1% | -3.7% | +4.5% |
| Comment | The share is trading ex-dividend on 30 September 2025. The price is holding above the 200-day SMA with seasonal strength, though upside momentum is muted. Our target remains $428.00 with a trailing stop at $377.00. | The share is trading ex-dividend on 12 September 2025. A rising wedge, while trading below the 200-day SMA, makes for a countertrend setup with downside momentum a concern. Our target is $336.00 with a stop-loss at $298.00. | The price is in an inclining channel above the 200-day SMA, though upside momentum has stalled. Our target remains $331.00, with a trailing stop at $300.00. |
| Time to exit | 28 October 2025 | 30 September 2025 | 01 October 2025 |
| Share Name and Position | ETN - Buy (Continue to hold) |
|---|---|
| Entry | 334.86 |
| Current Price | 348.23 |
| Movement | +4.0% |
| Comment | <The price appears to be forming wave b under the Elliott Wave theory, holding above the 200-day SMA, though downside momentum is a concern. Our target remains $395.00, with a trailing stop at $324.00. |
| Time to exit | 28 April 2026 |
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