Costco Shares Drop 1.25% Amid $2.3 Billion Trading Surge Ranks 31st in Market Activity

On August 13, 2025, Costco (COST) closed down 1.25% despite a 46.52% surge in trading volume to $2.3 billion, ranking it 31st in market activity. The stock trades at a forward 12-month P/E of 50, above the retail industry average of 33.02 and the S&P 500’s 22.62. While slightly below its 12-month median P/E of 50.74, its valuation remains elevated compared to peers like Ross Stores (22.72), Dollar General (18.92), and Target (13.50).

Costco’s membership model continues to drive growth, with 79.6 million paid household members—a 6.8% annual increase. Executive memberships, which contribute 73.1% of global sales, rose 9% to 37.6 million. Membership fees grew 10.4%, bolstered by a recent price hike. E-commerce sales climbed 14.8% in Q3 2025, supported by expanded logistics and a “Buy Now Pay Later” partnership with Affirm. Kirkland Signature’s penetration increased 50 basis points year-over-year, enhancing margins through localized sourcing and cost controls.

Despite robust fundamentals, competitive pressures and macroeconomic risks linger. Rivals are investing in customer experience upgrades, while foreign exchange volatility and tariffs pose uncertainties. Zacks Consensus estimates project 11.6% and 10.9% earnings growth for the current and next fiscal years, respectively, but the stock’s premium valuation has prompted a “Hold” rating. Analysts suggest patience for a more attractive entry point amid its strong but fully priced momentum.

A backtest of a strategy buying top 500 volume stocks and holding for one day from 2022 to 2025 yielded a 31.52% total return over 365 days, averaging 0.98% per day. The approach peaked at 7.02% in June 2023 but dropped 4.20% in September 2022, highlighting its sensitivity to market swings. While modestly stable, returns reflect limited outperformance against broader benchmarks.