COST Stock Hits Record Highs Today – Why Oppenheimer Sees Further Upside Potential In Costco

• Oppenheimer expects transitory margin headwinds related to fuel to contribute to a modest earnings-per-share shortfall for Costco.
• The analyst highlighted Costco's defensive business model and superior value proposition.
• Earlier this month, Bernstein stated the ‘Big Beautiful Bill Act’ will boost comparable sales momentum for retailers catering to higher-income consumers, including Costco. 

Shares of Costco Wholesale Corp. (COST) drew investor attention on Tuesday after an Oppenheimer analyst raised the firm’s price target ahead of its third-quarter earnings, citing the company's defensive business model and superior value proposition.

Oppenheimer Keeps Costco As Top Pick

Oppenheimer analyst Rupesh Parikh hiked Costco’s price target to $1,160 from $1,100 and kept an ‘Outperform’ rating ahead of its quarterly report. The price target increase represents a 5% hike from the firm's previous estimate. The analyst has also reiterated its top pick ranking, according to TheFly. 

The firm expects transitory margin headwinds from fuel to contribute to a modest earnings-per-share shortfall, and even though the stock's valuation is no longer discounted, it sees a strong outperformance case for Costco.

The analyst noted that Costco's defensive business model and superior value proposition across omni-channel/fuel fronts should continue to drive outsized market share gains. In addition, Parikh sees potential for a special dividend and/or a stock split, which could serve as a positive catalyst for the company.

Earlier this month, Bernstein stated the ‘Big Beautiful Bill Act’ will boost comparable sales momentum for retailers catering to higher-income consumers, including Costco. 

The firm cautioned that fuel cost pressures, general inflation, and reductions in social transfers could offset some retailers and potentially affect their earnings. 

According to Koyfin data, the 12-month average target for the stock is $ 1,074.78, implying a discount of about 1.4% from its current level. 

Twenty-two of 36 analysts rate the stock 'Buy' or higher, 12 recommend a 'Hold' rating, and 2 rate it 'Sell', according to Koyfin data.

Costco Set To Report Q3 Earnings

Costco is scheduled to report its third-quarter 2026 earnings on May 28, 2026. The company posted sales of $23.92 billion for April, up 13% from $21.18 billion last year, and also increased its quarterly dividend to $1.47 per share from $1.30 per share, $5.88 on an annualized basis.

According to Fiscal.AI, analysts expect earnings of $4.98 per share and revenue of $69.52 billion in the third quarter.

What Does Retail Think Of COST?

On Stocktwits, retail sentiment for the stock has been ‘bullish’, with ‘high’ message volume over the past 24 hours.

One user on Stocktwits said the analyst coverage on Costco stock has been broadly constructive.

https://stocktwits.com/jayjogia/message/653804946

Shares of Costco Wholesale Corp have gained more than 28% so far this year, outperforming the Vanguard S&P 500 ETF, which has gained over 7% year to date.

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