Costco Wholesale faces a class-action suit filed in the U.S. District Court for the Southern District of California on behalf of two consumers who allege that in-store signage and online descriptions falsely advertise the Kirkland Signature Seasoned Rotisserie Chicken as containing no preservatives. Court papers assert the chicken includes added sodium phosphate and carrageenan, both of which function as preservatives, contradicting prominent ‘No Preservatives’ statements. Plaintiffs claim that ingredient disclosures appear only in small print on the label’s reverse and do not explain preservative function, leaving shoppers unaware they were purchasing a product containing additives. If successful, the suit could expose Costco to statutory damages under California’s consumer protection statutes, injunctive relief requiring revised labeling, and reimbursement of plaintiff legal fees—outcomes that investors should monitor for potential reputational and financial impact.

In its latest SEC filing, Capital Investment Counsel Inc reduced its position in Costco by 3.3 percent, selling 2,242 shares and holding 65,491 shares valued at approximately 60.6 million dollars, making Costco its third-largest portfolio weighting at 7.4 percent. Brighton Jones LLC increased its holdings by 12.3 percent to 19,825 shares worth 18.2 million dollars, while Revolve Wealth Partners added 130 shares (up 13.1 percent) to reach 1,123 shares valued at just over one million dollars. Drucker Wealth 3.0 LLC boosted its stake by 45 percent, acquiring 204 shares for a total of 657 shares, and Sivia Capital Partners lifted its position by 4.5 percent to 3,853 shares valued at 3.8 million dollars. These shifts highlight both confidence from some money managers and profit-taking by others.

Costco reported quarterly revenue of 67.31 billion dollars, an 8.3 percent increase year-over-year, and delivered earnings per share of 4.34, beating consensus by 0.07. The company achieved a return on equity of 29.35 percent and maintained a net margin of 2.96 percent. Management reaffirmed full-year earnings guidance of approximately 18.03 per share. In conjunction with its earnings release, Costco declared a quarterly dividend of 1.30 per share, representing an annualized payout of 5.20 and a yield of roughly 0.5 percent, with shareholders of record on January 30 set to receive payment on February 13. Investors should weigh strong top-line growth and disciplined capital returns against consumer perception risks from the pending litigation.