Barclays raises Costco stock price target to $1,000

On Friday, Barclays (LON:BARC) updated its price target for Costco Wholesale (NASDAQ:COST), lifting it to $1,000 from the previous $980 while maintaining an Equalweight rating on the stock. The revision follows a strong performance by the retailer, with the company demonstrating robust trends that set it apart in the retail sector. Currently trading at $1,008 with a market capitalization of $447.6 billion, InvestingPro analysis suggests the stock is trading above its Fair Value, with a P/E ratio of 58.8x.

Barclays analysts noted that Costco’s recent quarter showcased impressive growth, including market share gains, expanding price gaps compared to competitors, increased e-commerce sales, and productivity enhancements. These factors, along with the company’s scale, have contributed to improved profit margins. The company has demonstrated solid revenue growth of 5.94% over the last twelve months, generating $268.8 billion in revenue. As a result, Barclays has adjusted its estimates upward once more. For deeper insights into Costco’s valuation and growth metrics, InvestingPro subscribers have access to over 12 additional key financial indicators and expert analysis.

The report highlighted that while the base case suggests estimates for Costco may continue to rise, as evidenced in the recent quarter, there are risks on the horizon. Concerns include the potential for a slowdown in consumer spending, which could be influenced by new tariffs, accelerating inflation, and decelerating income growth. Despite these risks, the analysts believe that the momentum and the consumer shift towards warehouse clubs seem to be more structural changes rather than temporary trends.

Barclays’ stance on the stock remains Equalweight due to valuation considerations. This suggests that while acknowledging Costco’s strong operational performance and market position, the firm’s analysts believe the current stock price adequately reflects the company’s prospects.

In their commentary, Barclays analysts stated, "Key take: A strong quarter reflecting some of the best trends in retail, with share gains, widening price gaps, gains in e-commerce and productivity improvements and scale helping drive margins. Our estimates move up again as detailed later, while we remain EW due to valuation. Base case, estimates could grind higher as we saw again this quarter, while the risk is that the consumer actually starts to slow (and differently than the last few years as tariffs kick in and inflation accelerates while consumer income growth slows). That said, the momentum and shift to the warehouse clubs continue to feel more structural."

The updated price target and continued Equalweight rating indicate that while the analysts recognize Costco’s current strengths, they also remain cautious about future market conditions that could impact the retailer’s performance. InvestingPro data shows the company maintains a strong financial health score of 2.94 (GOOD) and has consistently paid dividends for 22 consecutive years, demonstrating long-term stability despite current valuation concerns. For comprehensive analysis of Costco’s financial health and future prospects, investors can access the detailed Pro Research Report, available exclusively to InvestingPro subscribers.

In other recent news, Costco Wholesale Corporation reported its Q3 2025 earnings, revealing a net income of $1.9 billion, marking a 13% increase year-over-year. Despite earnings per share (EPS) of $4.28 slightly surpassing forecasts, revenue fell short at $61.96 billion against an anticipated $63.11 billion. Analyst firms have reacted to these results with varying adjustments to Costco’s stock outlook. Loop Capital Markets maintained a Buy rating but reduced the price target to $1,110, citing economic uncertainties. Meanwhile, Raymond (NSE:RYMD) James sustained an Outperform rating with a $1,070 price target, expressing confidence in Costco’s robust comparable store sales growth of 8.0% year-over-year, excluding gas and foreign exchange impacts.

Bernstein analysts raised their price target to $1,153, acknowledging Costco’s strong quarterly performance and potential for continued global expansion. Despite the high valuation of Costco’s stock, they highlighted the company’s top-tier status and the potential risks if sales growth decelerates. Costco’s strategic initiatives, such as delaying cost increases to consumers, have contributed to its market share growth, according to Loop Capital. Membership fee income saw a significant 10.4% rise, bolstering the company’s financial position. Costco plans to open 27 new warehouses by the end of the fiscal year, demonstrating its commitment to expansion and enhancing customer experience through digital engagement and new product offerings.

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