In a market obsessed with tech, Costco (NASDAQ: COST) has quietly compounded shareholder wealth through a simple formula: scale, efficiency, and member loyalty.
OnlyMembers
Costco doesn’t earn most of its profits from selling goods—but from its membership fees. With over 128 million members globally and a renewal rate above 90%, its subscription-like model creates recurring revenue that powers price competitiveness.
Performance at Best
Despite inflationary headwinds, Costco’s Q1 FY25 revenue grew 6.1% YoY. Same-store sales remained strong, especially in international markets. The company’s operating margins remain among the highest in retail due to limited SKUs and private-label dominance.
Moving Beyond US Markets
Costco is ramping up global expansion with new stores in China, Japan, and Europe. Analysts note its success in China (with thousands queuing at openings) could mirror its U.S. playbook: suburban warehouses + premium-value pricing = sticky loyalty.
Deeper Dive
According to Morningstar, Costco’s wide moat is driven by cost advantage and customer captivity. Its cautious yet consistent growth strategy sets it apart in the volatile retail landscape.
Trader View: Price Trend & Moving Averages
The first thing that jumps off the screen is the price trend. $COST is clearly in a bullish uptrend with strong structure:
- Price: Closed at $1,040.18 , just shy of its all-time high at $1,078.23 .
- Short-term MA (20-day, red): Riding right along it — this one’s been hugging price tight, showing strong short-term momentum.
- Medium-term MA (50-day, blue): Firmly rising and recently tested — it’s acting as a dependable support level.
- Long-term MA (200-day, orange): Smooth and steady slope upward. That’s the kind of line you want to see under a trending stock — no cracks, no flattening.
- Trendline: Clean ascending support from mid-2023 — still holding and guiding the price higher.
This is what I call a “buy-the-dip bull.” Every pullback over the past year has been met with support — and more often than not, buyers step back in before it even hits the 50-day.
2. Volume
Volume spiked recently, especially post-earnings. That kind of confirmation matters — it tells me institutions were active in this move, not just retail chasing headlines.
You want to see high volume on breakouts — and Costco gave us that.
3. MACD (Moving Average Convergence Divergence)
MACD is in a bullish crossover above the zero line. This means the shorter-term moving average is moving faster than the longer-term — a sign that upside momentum is in play .
The MACD lines are also curling up and diverging — that’s good. You don’t want to see them flatten or start converging unless you’re already long and looking to exit.
4. Relative Strength Index (RSI)
RSI is hovering around 62 — bullish but not overheated. I typically start raising an eyebrow when we cross 75-80. But right now, we’re in the sweet spot where momentum is strong without being at risk of snapping back .
Read more in detail:
https://www.investors.com/research/ibd-stock-of-the-day/costco-stock-cost-breakout-buy-point-q3-earnings-2025/