By Sabrina Escobar
Costco Wholesale posted stronger-than-expected sales for December, giving the stock a much-needed lift on Thursday.
The company's net sales in December rose 8.5% from a year earlier to $29.9 billion. Total-company same-store sales increased 7%, accelerating slightly from November's 6.9% rise.
U.S. same-store sales, when stripping out fluctuations in gas prices and foreign exchange, accelerated to a 6.3% annual increase from November's 5.8% gain.
"December sales provide a measure of relief, confirming a reacceleration in sales at a pace that are clearly gaining share," wrote Greg Melich, an analyst at Evercore ISI.
Concerns over slowing same-store sales growth weighed on Costco's stock in 2025. Shares fell a little over 5% in 2025, while the S&P 500 gained about 17%. Higher tariffs, a lofty valuation, a dip in membership renewal rates, and tough comparisons from strong gold bar and gift card sales also clouded the investor outlook.
Those challenges will likely continue into 2026, analysts say. But the December sales report could be the first turning point for the stock by easing worries about the company's ability to keep same-store sales growth in the mid-single-digit percentage range, wrote Phillip Blee, an analyst at William Blair. The analyst raised his sales and earnings estimate to reflect increased confidence in Costco's ability to deliver upside throughout the quarter.
"This could provide the stock with a much-needed boost after dropping some 10% over the past six months or so on concerns around its elevated valuation and a rotational shift out of the sector," Blee wrote.
Costco stock was up 1.7% in morning trading Thursday. The shares have gained 4% this year, but are still about 3.3% lower on a 12-month basis.
Analysts are tracking several potential catalysts that could reignite Wall Street's interest in the stock, including a potential special dividend and an uptick in membership renewal rates.
Costco's latest sales results are also a good sign that consumer demand remained healthy throughout the holiday season, particularly among higher-income consumers. Small appliances and other gift categories performed well in December, the company said.
And indeed, digitally-enabled same-store sales -- which skew toward more discretionary items -- rose 18.9% from a year ago. Data from Adobe Analytics found that online shopping rose 6.8% year over year to $257.8 billion from Nov. 1 to Dec. 31, marking a new high for e-commerce.
Write to Sabrina Escobar at sabrina.escobar@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
January 08, 2026 10:47 ET (15:47 GMT)
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