Costco (COST, $467.75) beat fiscal Q4 expectations; will limit purchases owing to supply chain issues
Costco reported its fiscal fourth quarter earnings that surpassed analysts’ expectations. However, the big-box retail giant said that it would begin limiting purchases of certain essential items amid supply chain challenges.
Costco's earning in the quarter came in at $3.76 per share, up +23.7% year-over-year, and beating analysts’ expectations of $3.58 per share. Gross margins, however, fell -32 basis points to 10.9% owing to rising supply chain costs amid COVID-19 pandemic.
Revenue rose +17% from the year-ago quarter to $62.68 billion, compared to analysts’ estimates of $61.4 billion.
Comparable sales rose by a higher-than-expected +9.4%. Membership fees increased +11.7% to $1.234 billion, and total members topped 61.7 million.
During the earnings call, Costco Chief Financial Officer Richard Galanti said the retailer is “putting some [purchase] limitations on key items.” The items include toilet paper, paper towels, bottled water and high-demand cleaning products. But Galanti did not specify how many of each item customers will be allowed to purchase. The limitations are being placed due to shipping delays and truck driver shortages.
Galanti mentioned that the company has chartered three ocean vessels for the next year to transport containers between Asia and the U.S. and Canada. Each ship has the capacity to carry 800 to 1,000 containers at a time, he said.
COST in downward trend: price may decline as a result of having broken its higher Bollinger Band on August 24, 2026
COST broke above its upper Bollinger Band on August 24, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options. The A.I.dvisor looked at 46 similar instances where the stock broke above the upper band. In 25 of the 46 cases the stock fell afterwards. This puts the odds of success at 54%.
Technical Analysis (Indicators)
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on August 27, 2026. You may want to consider selling the stock, shorting the stock, or exploring put options on COST as a result. In 30 of 74 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are 41%.
The Moving Average Convergence Divergence Histogram (MACD) for COST turned negative on August 27, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 48 similar instances when the indicator turned negative. In 24 of the 48 cases the stock turned lower in the days that followed. This puts the odds of success at 50%.
COST moved below its 50-day moving average on August 31, 2026 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for COST crossed bearishly below the 50-day moving average on September 04, 2026. This indicates that the trend has shifted lower and could be considered a sell signal. In 6 of 19 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are 32%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where COST declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 38%.
Bullish Trend Analysis
The RSI Oscillator points to a transition from a downward trend to an upward trend -- in cases where COST's RSI Indicator exited the oversold zone, 22 of 27 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 81%.
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 6 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
Following a +4.06% 3-day Advance, the price is estimated to grow further. Considering data from situations where COST advanced for three days, in 222 of 358 cases, the price rose further within the following month. The odds of a continued upward trend are 62%.
Fundamental Analysis (Ratings)
The Tickeron Profit vs. Risk Rating rating for this company is 19 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 65, placing this stock better than average.
The Tickeron SMR rating for this company is 35 (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Price Growth Rating for this company is 60 (best 1 - 100 worst), indicating fairly steady price growth. COST’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is 62 (best 1 - 100 worst), pointing to average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of 99 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: COST's P/B Ratio (11.976) is slightly higher than the industry average of (6.945). P/E Ratio (45.512) is within average values for comparable stocks, (35.983). COST's Projected Growth (PEG Ratio) (4.435) is slightly higher than the industry average of (2.624). Dividend Yield (0.006) settles around the average of (0.014) among similar stocks. P/S Ratio (1.370) is also within normal values, averaging (1.018).
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a company which sells goods through membership warehouses
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