Bank of America Backs Costco with $1,185 Target, Forecasts 10% Q3 Revenue Growth

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2026-05-26

Bank of America maintained its Buy rating on Costco with a $1,185 price target, implying over 15% upside after shares slipped 2% ahead of fiscal Q3 results. Analysts project Q3 revenue up about 10% year-over-year to $69.6 billion and EPS of $4.98, while market share gains and value pricing may support another special dividend.

1. Analyst Rating and Price Target

Costco shares dipped about 2% after Bank of America reiterated its Buy rating and set a $1,185 price target, signaling more than 15% potential upside from current levels.

2. Q3 Revenue and EPS Projections

Analysts expect fiscal Q3 revenue to rise roughly 10% year-over-year to $69.6 billion for the quarter ended May 10, with diluted earnings per share projected at $4.98.

3. Value Strategy and Market Share Gains

Costco’s value-focused pricing strategy continues to attract higher-income consumers, driving healthy comparable sales growth and steady retail market share gains.

4. Dividend Prospects and Balance Sheet

With strong cash generation and a solid balance sheet, Costco could support another special dividend if revenue growth continues to outpace selling and administrative expenses.