Bernstein Raises Costco Target to $1,155, Cites Inflation and Macro Uncertainty
Bernstein raised Costco’s price target to $1,155 from $1,146, kept Outperform rating and flagged weak sentiment, rising food inflation and macro risks from drug pricing, SNAP benefits, tariffs and World Cup. January total sales rose 9.3% with comparable sales up 7.1%, and digital transactions now account for 10% of revenue.
1. Price Target Increase
On February 9, Bernstein analyst Zhihan Ma lifted Costco’s 12-month price target to $1,155 from $1,146 while maintaining an Outperform rating. The firm highlighted soft consumer sentiment, renewed food inflation pressures and multiple macro uncertainties as key considerations.
2. January Sales Results
Costco reported January total sales growth of 9.3% year-over-year, with comparable-warehouse sales rising 7.1%. Excluding fuel and currency effects, adjusted comp sales accelerated to 6.4% from December’s 6.2%, reflecting steady underlying demand.
3. Digital Sales Growth
Digital revenue channels, defined as purchases initiated via device and fulfilled in warehouses or through Costco Travel, now represent 10% of total revenue. This share underscores the growing importance of e-commerce to membership warehouse performance.
4. Macro Uncertainties
Analysts flagged several factors clouding fiscal 2026 outlook: potential changes in drug pricing rules, SNAP benefit adjustments, evolving tariff policies, timing of tax refunds and possible World Cup-related consumer spending shifts.