Costco Wholesale (COST.OQ): And On to the Next (Year)

COST finished its year with another solid quarter, with healthy top-line growth, margin performance largely in line with expectations, and an EPS beat, even after adjusting for the $0.15/share benefit from tariff refunds. More importantly, we remain constructive on the FY27 setup given: 1) solid MSD underlying comp momentum, with reasonable two-year comparisons; 2) strength in ancillary businesses which should support traffic; 3) strong non-food trends which set COST up well for holiday; and 4) ongoing digital progress including expanding delivery partnerships and AI-driven search, traffic, and personalization initiatives. While membership trends will likely remain an investor concern, we continue to view the long-term trajectory positively. 4Q adj. EPS was $6.60 (DB $6.38; Street $6.53) excluding a $0.15 tariff refund benefit;