Overview
- Northcoast raised Costco to Buy on Dec. 24 with a $1,100 price target, and analyst Chuck Cerankosky said cash reserves could enable another special dividend, potentially up to $20 per share.
- Costco’s high-margin membership model delivered roughly $1.3 billion in Q1 fiscal 2026 fee income, reinforcing a predictable cash engine that funds shareholder returns.
- Digital momentum accelerated with quarterly e-commerce sales up 20.5%, record Black Friday non-food orders exceeding $250 million, and sharp gains in website and app traffic.
- Regular dividends total $5.20 annually after decades of yearly increases, and the company has a track record of one-off payouts, including $15 per share in December 2023 and $10 in December 2020.
- Management noted slower sign-ups and renewals among younger, digitally enrolled members, even as international expansion opportunities and Costco’s scale-driven cost advantages support long-term growth.