Highly Regarded

Is Costco Wholesale Corporation (COST) Stock Undervalued or Overvalued?

Trailing-twelve-month multiples vs Consumer Staples sector peers in our coverage

64% Premium TTM fundamentals · sector averages from covered peers

COST trades at 53.0× TTM earnings — a 64% premium to its Consumer Staples sector average of 32.2× in our coverage.

The Numbers

P/E (TTM)

53.0×

Sector avg: 32.2×

P/S (TTM)

1.6×

Sector avg: 3.9×

Market Cap

$439.07B

EPS (TTM): $18.67

Revenue (TTM)

$280.39B

Net income: $8.30B

Consumer Staples Peer Comparison

How COST's multiples stack up against sector peers we cover. Click any peer for its own valuation breakdown.

Stock Price P/E (TTM)
COST This page $989.19 53.0×
WMT $118.83 41.5×
KO $93.85 33.3×
PEP $131.52 21.9×

Is the Premium Justified?

October 11, 2026

Costco Wholesale Corporation's P/E of 50.7x commands a premium over the sector average of 35.5x, largely justified by its consistent growth and robust membership model. The company reported strong fiscal 2026 results, with revenue rising to $303.15 billion and diluted EPS of $20.76, fueled by membership growth and omnichannel sales. Net sales increased by 10%, accompanied by an 8% gain in comparable sales and a 21% surge in digitally enabled comparable sales. Membership fees grew 11%, with high renewal rates near 92% in the U.S. and Canada, underscoring strong customer loyalty. Costco plans significant capital expenditures for up to 33 new warehouses in fiscal 2027, indicating continued expansion. While the pace of membership growth has shown some moderation, existing members continue to demonstrate strong retention.

Sources

Frequently Asked Questions

Is COST overvalued or undervalued?
On trailing-twelve-month earnings, COST trades at 53.0x versus a Consumer Staples sector average of 32.2x in our coverage — a 64.3% premium. Whether that's justified depends on growth, margins, and risk; see the context above.
What does the P/E ratio tell you?
Price-to-earnings compares a company's share price with its per-share profits. A higher multiple means investors pay more per dollar of earnings — often for faster expected growth — while a lower one can signal slower growth or higher perceived risk.
Why compare against the sector average?
Valuation multiples vary structurally between industries — software typically trades richer than banks or energy. Comparing COST with its own Consumer Staples peers is more informative than comparing against the whole market.
Is a cheap stock automatically a good buy?
No. A discount can be justified by weak growth or elevated risk (a "value trap"), and a premium can be earned by quality and consistency. Valuation is one input — pair it with the fundamentals and the AI context on this page.

Methodology

Multiples are computed from trailing-twelve-month fundamentals (from company filings) and the latest share price: P/E is price ÷ diluted EPS, and P/S is market cap ÷ revenue. Sector averages use the Consumer Staples names in our 50-stock coverage with positive earnings — a deliberately like-for-like, if imperfect, benchmark.

Stocks with negative trailing earnings are compared on price-to-sales instead. Multiples update with prices and fundamentals; AI context refreshes weekly.

Not Financial Advice

This page is for education and information only. Indicators are mechanical calculations, AI commentary can contain errors, and nothing here is a recommendation to buy or sell any security. Do your own research and consider consulting a qualified financial advisor. See our full disclaimer.

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Same question, Consumer Staples peers

KO PEP WMT PG