Costco (COST) vs Walmart (WMT): Membership Momentum Slows as Digital Shifts Gain Ground
Key Takeaways
- COST posted double-digit revenue growth and a slim earnings beat, but membership-fee growth is decelerating from roughly 14% to 7%.
- WMT delivered broad-based gains across e-commerce, advertising, and membership income, and raised its full-year outlook.
- Both stocks carry premium valuations well above the broader retail sector, making relative performance sensitive to execution and sentiment.
- COST leans on a recurring membership model, while WMT is pivoting toward higher-margin digital and advertising revenue.
- Recent share-price momentum has been muted for both names, with WMT notably softer over the trailing three months.
Why This Comparison Matters
Costco Wholesale and Walmart are two of the largest and most closely watched retailers in the world, yet they occupy different corners of the consumer landscape. Costco operates a membership-based warehouse-club model, while Walmart is a sprawling omnichannel retailer with a fast-growing digital and advertising business. This stock comparison is relevant for investors weighing a premium, membership-driven growth story against a diversified retail giant transforming its profit mix. Traders tracking relative performance and market positioning may also find the contrast useful, since the two names respond to different catalysts even as they compete for the same consumer dollar. I checked the relative positioning with Tickeron’s AI Screener to see how the names stack up against peers.
Costco's Latest Results and Membership Trends
Costco Wholesale (COST) runs 939 membership warehouses across 14 countries and generates a large share of its operating income from recurring membership fees. In its most recent quarter, net sales rose 11.2% to $93.9 billion, and total revenue climbed 11.1% to $95.7 billion. Reported earnings per share reached $6.75, while adjusted EPS of $6.60 rose 12.4% year over year. That result included a one-time benefit of roughly $0.15 per share from tariff refunds tied to the International Emergency Economic Powers Act (IEEPA), which investors have increasingly backed out of the numbers.
Comparable sales rose 9.4%, or 6.7% excluding gasoline and foreign-exchange effects, supported by a 3.3% increase in traffic. Digitally enabled comparable sales grew 19.5%. The key watch item has been membership momentum: fee income grew 7.3%, a sharp slowdown from the roughly 14% growth seen earlier in the fiscal year, though renewal rates held steady at 92.3% in the U.S. and Canada. Shares have traded near record levels even as the stock pulled back modestly over recent months, leaving the valuation above 40 times earnings. From what I see, the traffic resilience is worth monitoring closely.
Walmart's Strong Quarter and Outlook Upgrade
Walmart (WMT) is a people-led, technology-powered omnichannel retailer serving roughly 280 million customers weekly across more than 10,900 stores and numerous e-commerce sites in 19 countries. In its most recent reported quarter, revenue rose 5.9% to $187.9 billion, and adjusted EPS increased 19.1% to $0.81. Global e-commerce sales grew 23%, the advertising business expanded 38%, and membership fee revenue advanced 17%, highlighting a shift toward higher-margin revenue streams.
Walmart raised its full-year outlook, lifting its constant-currency net sales growth target to 4%–5% and its adjusted operating income growth range to 7%–8.5%. The quarter also benefited from tariff refunds that partly offset planned price investments. Near-term headwinds include elevated fuel costs, heavier capital spending, and the Most Favored Nation (MFN) drug-pricing policy, which management estimates has reduced U.S. same-store sales growth by roughly 80 basis points. The stock has been softer over the past three months, trading around the low $100s, even as its five-year total return remains well above 100%. I also checked this using Tickeron’s AI Daily Buy/Sell Signals to gauge the recent price action.
How the Two Retailers Compare
The two companies differ most sharply in business model. Costco's economics depend heavily on a high-margin membership fee stream, giving it predictable recurring revenue but exposing it to the pace of new-member growth. Walmart, by contrast, is monetizing its enormous store network through e-commerce, advertising, and membership, gradually shifting its profit mix away from low-margin merchandise.
Growth drivers also diverge. Costco's story centers on warehouse expansion, digital adoption, and executive-member penetration, while Walmart's rests on marketplace growth, advertising scale, and automation. On momentum, Costco has shown more resilient share-price action over the trailing three months, whereas Walmart has faced a softer tape despite upbeat fundamentals. Risk profiles differ as well: Costco faces valuation and membership-deceleration risks, while Walmart contends with fuel costs, pharmacy pricing policy, and heavy capital investment. Sector exposure is similar—both are consumer-staples-adjacent defensive names—but market sentiment currently rewards Costco's steadier compounding even as Walmart's mix shift offers a broader catalyst set.
AI-Assisted Trend Assessment
Based on observable trend consistency, stability, and relative positioning, the analysis leans toward COST. The company's recurring membership income, resilient traffic growth, and steadier price action give it a more consistent trend profile than WMT, whose near-term momentum has been choppier despite strong fundamentals. The decelerating membership-fee growth remains the primary caveat, but renewal-rate stability and record executive penetration suggest the underlying franchise remains intact. This is a probabilistic assessment of trend quality rather than a definitive forecast, and it could shift as new price and fundamental data emerge.
Using AI Tools for Deeper Research
When evaluating stocks like these, I often review Tickeron’s Trending AI Robots section. It highlights bots that align with current market conditions across different styles and timeframes, which helps put the relative momentum of names such as COST and WMT into context without replacing individual judgment.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
COST's RSI Oscillator recovers from oversold territory
The RSI Indicator for COST moved out of oversold territory on September 11, 2026. This could be a sign that the stock is shifting from a downward trend to an upward trend. Traders may want to buy the stock or call options. The A.I.dvisor looked at 27 similar instances when the indicator left oversold territory. In 20 of the 27 cases the stock moved higher. This puts the odds of a move higher at 74%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on September 25, 2026. You may want to consider a long position or call options on COST as a result. In 47 of 75 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 63%.
The Moving Average Convergence Divergence (MACD) for COST just turned positive on September 25, 2026. Looking at past instances where COST's MACD turned positive, the stock continued to rise in 30 of 50 cases over the following month. The odds of a continued upward trend are 60%.
Following a +1.13% 3-day Advance, the price is estimated to grow further. Considering data from situations where COST advanced for three days, in 219 of 355 cases, the price rose further within the following month. The odds of a continued upward trend are 62%.
Bearish Trend Analysis
The Stochastic Oscillator may be shifting from an upward trend to a downward trend. In 26 of 63 cases where COST's Stochastic Oscillator exited the overbought zone, the price fell further within the following month. The odds of a continued downward trend are 41%.
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 4 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 21%.
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%.
COST broke above its upper Bollinger Band on September 25, 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 Aroon Indicator for COST entered a downward trend on October 02, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Fundamental Analysis (Ratings)
The Tickeron Profit vs. Risk Rating rating for this company is 18 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 63, 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 PE Growth Rating for this company is 53 (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 Price Growth Rating for this company is 56 (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 Seasonality Score of 75 (best 1 - 100 worst) indicates that the company is slightly overvalued 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 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: P/B Ratio (11.429) is normal, around the industry mean (7.191). P/E Ratio (44.457) is within average values for comparable stocks, (36.397). COST's Projected Growth (PEG Ratio) (4.478) is slightly higher than the industry average of (2.171). Dividend Yield (0.006) settles around the average of (0.009) among similar stocks. P/S Ratio (1.353) is also within normal values, averaging (1.008).
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
Advertisement
General Information
a company which sells goods through membership warehouses
Industry DiscountStores
Advertisement