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.
Momentum Indicator for COST turns negative, indicating new downward trend
COST saw its Momentum Indicator move below the 0 level on July 08, 2025. This is an indication that the stock could be shifting in to a new downward move. Traders may want to consider selling the stock or exploring put options. Tickeron's A.I.dvisor looked at 73 similar instances where the indicator turned negative. In of the 73 cases, the stock moved further down in the following days. The odds of a decline are at .
Technical Analysis (Indicators)
Bearish Trend Analysis
COST moved below its 50-day moving average on June 24, 2025 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 June 18, 2025. This indicates that the trend has shifted lower and could be considered a sell signal. In of 16 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 .
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 of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for COST entered a downward trend on July 17, 2025. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Bullish Trend Analysis
The RSI Oscillator points to a transition from a downward trend to an upward trend -- in cases where COST's RSI Oscillator exited the oversold zone, of 21 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 5 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 3-day Advance, the price is estimated to grow further. Considering data from situations where COST advanced for three days, in of 378 cases, the price rose further within the following month. The odds of a continued upward trend are .
COST may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 59, placing this stock better than average.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very 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 PE Growth Rating for this company is (best 1 - 100 worst), pointing to consistent 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 Seasonality Score of (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Price Growth Rating for this company is (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 Valuation Rating of (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: P/B Ratio (15.601) is normal, around the industry mean (8.317). P/E Ratio (54.107) is within average values for comparable stocks, (32.590). COST's Projected Growth (PEG Ratio) (5.068) is slightly higher than the industry average of (2.910). Dividend Yield (0.005) settles around the average of (0.026) among similar stocks. P/S Ratio (1.579) is also within normal values, averaging (1.549).
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General Information
a company which sells goods through membership warehouses
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