Costco shares have retreated nearly 20% from their peak this year, as investors penalize higher-multiple growth names despite healthy underlying trends. Trailing P/E stands at approximately 46.7x, a premium to peers trading around 39x. With the stock price hovering near $867 per share, retail investors face a practical barrier to entry, prompting speculation that management could authorize a 10-for-1 split in 2026 to broaden access and reset valuation multiples. No official split has been announced, but analysts argue the combination of fractional-share availability and the potential to recapture four-figure share prices makes the case compelling.

Costco’s membership model remains its most reliable profit driver. In fiscal 2025, membership fee revenue climbed to roughly $5.3 billion, driven by a late-2024 fee increase and growth to 81 million paid households with a renewal rate near 90% in North America. Net sales rose about 8% year-over-year, while fourth-quarter comps grew 5.7% as traffic gains and higher average tickets offset macro pressures. E-commerce sales outpaced warehouse growth, and the company opened 27 new warehouses globally, pushing its total past 900 locations—all without sacrificing its 12.9% gross margin target.

During Q3, IMS Investment Management Services reduced its position by 2,053 shares, leaving 5,194 shares valued at approximately $4.8 million, while Annex Advisory Services increased its stake by 2,841 shares to hold 38,395 shares valued at about $35.5 million. Insider sales totaled 6,339 shares over the last 90 days (representing 0.10% insider ownership). On the capital return front, Costco paid a quarterly dividend of $1.30 per share in November, implying an annualized payout of $5.20 and a yield near 0.6%, with a payout ratio around 28%. Sell-side analysts maintain a Moderate Buy consensus with a target near $992 per share.