Costco (COST) shoppers kept spending through the last weeks of summer, and the numbers back it up. The warehouse giant posted another month of strong sales growth, giving investors plenty of reasons to watch Costco stock heading into Q4 2026.
The retailer's August results, covering the four weeks from Aug. 3 through Aug. 30, showed broad strength across regions and categories. Gas prices played a big role in the headline number, but even without that boost, Costco's core business kept growing at a healthy clip.
Here is what the latest report means for shoppers, the business, and anyone tracking Costco stock right now.
A Year of Steady Comp Growth
Costco has spent the past several quarters posting consistent comparable sales gains, even as shoppers wrestle with tariffs, inflation, and higher gas prices.
In its most recent quarterly earnings call, Chief Financial Officer Gary Millerchip said the company's third-quarter net sales rose 11.6% year-over-year to $69.15 billion. Comparable sales in Q3 rose 9.8%, or 6.6% once gas price swings and currency effects were stripped out. Executives credited a mix of factors for the strength, including growth in executive memberships, faster digital sales, and pricing moves meant to keep Costco competitive on everyday items like eggs and beef.
CEO Ron Vachris said on the call the company's strategy remains simple: be the first to lower prices and the last to raise them.
- Costco's net sales for August came in at $23.70 billion, a 10% increase from $21.56 billion during the same period last year.
- Total company comparable sales rose 8.4%.
- By region, the U.S. led with a 9.0% gain, followed by other international markets at 9.5% and Canada at 4.0%. Digitally enabled sales, which include online orders, jumped 17.9%, continuing a trend of online shopping outpacing in-store growth.
Strip out gas prices and currency swings, and total comparable sales cooled to 5.4%, a more accurate read on core demand. Worldwide shopper traffic rose 2.5%, and U.S. traffic climbed 2.3%, suggesting more members are walking through the doors, not just spending more per visit.
Notably, Labor Day fell a week later in 2026 than it did in 2025, and management said that calendar shift dragged down August total and comparable sales by just under 75 basis points. Even accounting for that, total comparable sales excluding gas and currency effects still landed around 5.3%.
Gas remained the biggest single driver of headline growth. The average worldwide price per gallon jumped 25.8% year-over-year, and gas price inflation alone added roughly 2.9 percentage points to total comparable sales. Worldwide average transaction size rose 5.7%, but excluding gas and currency impacts, that figure was a more modest 2.8%.
Note Costco's Regional and Category Strength
Regionally, the Southeast, San Diego, and the Midwest posted the strongest U.S. comparable sales in August. Overseas, Spain, China, and Korea stood out among Costco's international markets.
By category:
- Foods and sundries grew in the low single digits, led by food, frozen foods, and sundries.
- Fresh foods performed even better, up mid-single digits, powered by bakery and meat sales. Nonfood items, including home furnishings, sporting goods, and jewelry, also grew mid-single digits.
- Ancillary businesses — a category that includes gas, pharmacy, and hearing aids — were the standout performers, up nearly 30% for the month. Gas sales alone rose roughly 30%, almost entirely because of higher prices per gallon rather than more gallons sold.
Costco's next sales update will cover a longer stretch, the five weeks from Aug. 31 through Oct. 4, compared against the same window last year. That report will arrive shortly before the company's biggest release of the season. The retailer plans to report fourth-quarter and full-year fiscal 2026 earnings on Sept. 24, after market close, with a conference call scheduled for 2 p.m. Pacific time, according to the company statement. The report will give a fuller picture of profit trends, membership growth, and margin pressure that August's sales figures alone cannot capture.
Is Costco Stock Still Undervalued?
Valued at a market cap of over $400 billion, Costco stock has returned close to 600% over the past 10 years, after adjusting for dividends.
Analysts tracking Costco stock project adjusted earnings to expand from $20.57 per share in fiscal 2026 (ended in August) to $29 in fiscal 2031. COST stock trades at 42.4x forward earnings, which is quite lofty given its earnings growth forecast. Basically, I expect Costco stock to meaningfully underperform the broader markets until the valuation normalizes.
Out of the 36 analysts covering Costco stock, 19 recommend “Strong Buy”, four recommend “Moderate Buy”, 12 recommend “Hold”, and one recommends “Strong Sell”. The average Costco stock price target is $1,101, above the current price of $925.
For now, the August results suggest Costco's membership base is still spending freely, even with gas prices doing some of the heavy lifting. Investors watching Costco stock will likely keep a close eye on whether that core, gas-excluded growth rate holds steady once the September numbers land.
On the date of publication, Aditya Raghunath did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.