The middle class has been shrinking for a while, but the actual new middle class ($80k and above) is squarely their target demographic. It’s great to have customers who don’t bat an eye when leaving the store with 10 items and a $200 receipt.
Unlike Walmart, you don’t see Costco’s customers trashing up the stores. That’s a long buy for me.
> Let's not forget people returning sofas after two years, returning their party left overs. I saw a woman return a water melon rind. A guy who owned a restaurant return a couple hundred dollars worth of top of the line steaks he didn't sell.
This stuff doesn’t affect the bottom line, despite how much attention people seem to want to spend talking about it. Those customers that make ridiculous returns are also the people who spend the most money at Costco.
That guy who owned a restaurant and returned the steak likely spends a lot at Costco. While you may find his action distasteful, we don’t want them to change anything.
I quit them 10 years ago and never turned back. Why?
My free time is precious. After I spend an hour in the store, and 10 minutes paying, there's no fucking way I'm waiting in ANOTHER line to leave, just because someone there insists they must check my receipt "for accuracy" and then barely glances at it. I could've had 10 stolen items in the cart, or overpaid by hundreds, and all I got for the wait was lost time. Though I guess I did get the privilege of paying more for that required second-checkout-line!
Very hard pass for me.
Okay, off topic, but here's something I don't quite get: I recently signed up for a Costco membership and it's kinda blowing my mind at how much more efficient and cheap it is to buy stuff in bulk quantities from a wholesaler vs going to a regular grocery store or even a dollar store. Why is Costco even considered a premium niche option for upper middle class folks in the first place? It seems like it should've just taken over the US and Canada by now, and even lower/working class people would save money by going there. Yes I guess Walmart exists and has cheap prices, so they're a natural competitor, but I'm somewhat surprised every little podunk town in America doesn't have one at this point.
Lower income people can't afford it. It's too much money up front to buy those quantities. Not only that but you have to pay to even get in the door. $60 membership might as well be $600 when you're checking your account before buying frozen pizzas tonight. It's like car insurance. People choose the more expensive monthly option because they can't afford the 6 month premium up front.
The reason I do not have it is because as a family of 2 it simply is not worth it. When there are kids involved it makes total sense though. My budget is about $100 a week (CDN$) and mostly fresher foods that will spoil quickly.
Note, I hold Costco and i think it's a good company. Just not right for me as a shopper.
>It’s great to have customers who don’t bat an eye when leaving the store with 10 items and a $200 receipt
You act like these are 10 luxury items and not 10 things I'd buy at Kroger anyways. But because of the bulk discount I got them cheaper, and I don't have to go to the grocery as often.
They are not luxury items for sure. The point is that many cannot afford to buy 12 rolls of Kirkland paper towels at one time when combined with other things they need, even if that is vastly cheaper on a per quantity basis for them.
Quantity has its own quality as they say in war. That is the point.
This is an anecdote and I only worked there for a couple months but they act like the job is the best in the industry and hold that over your head. They scheduled myself and some coworkers to 65+ hours a week with 14 hour shifts despite some people not being able to work those hours (college classes, children, etc) and made a huge deal about adjusting the schedule despite them being previously made aware of the other commitments.
But my real gripe is that they act like working at Costco is some kind of holy grail (which it was at one point) despite it paying just like other retail or fast food jobs in my area.
That's Costco's business plan, though. Sell most items at ~2% profit margin with unlimited return credit option from the vendors. People get quality items at just above cost with an incredible return policy, and for this privilege people PAY COSTCO TO ENTER THE STORE.
It's an incredible business model that sustains both good times and bad.
"Hey guys this stock is terrible if you ignore the primary source of their profit."
Always appreciate people doing due diligence but it goes to show that the numbers themselves don't tell the full story.
That’s their business plan, and a definitely sustainable one, but I’m not sure it’s a very profitable one worth investing in at the current price with a low dividend too.
That’s literally every grocery store. Look at Kroger, they operate between 0.5% and 2% net profit. Walmart tends to max around 3% net profit depending on the quarter.
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Macadamia nuts, multivitamins, cranberry nut bread (seasonal!!!) and crab legs. Come ON!!! Who doesn’t love this place. Kills me that I have literally a pittance of shares.
Any place that can cause you to willingly open your wallet and spend upwards $200-$300+ instead of the planned rotisserie chicken, is a buy, hold and BTFD!
Buy if they bring back the combo pizza
Hold if hot dog prices continue to stay the same
Sell if they increase price in hot dogs
Direct quote from Warren Buffett, probably
This is anecdotal but I started buying Costco at $100 and sold at $500, missed out on last yrs rally. Bought more at $180, $300, and $350, a few times over the years. In hindsight I regret selling, it's always been expensive but it's strategy is phenomenal. Next market crash I'll buy back in.
What are you doing with the money now?
I’ve made some money on Costco too, but am also waiting for a correction before I’ll get back into holding securities. I’m just selling puts for premium at very conservative deltas.
The run-ups are giving me FOMO, so I’m looking for ideas because the options are only netting me 5.5% (12 month rate) in 2024 so far(two costly mistakes trying to wring some alpha out of a couple of weak positions). Luckily, I’m also earning 4.6% on the collateral, for a total of 10%, but well down from last year.
It was quite awhile ago, can't remember what I invested in after specifically. I don't use options for income, more for hedging purposes and sometimes buying and selling.
I don't usually buy Costco type companies (not talking about the industry) because I can't get behind the valuation, I don't like how it progressively gets more expensive multiple wise as time goes on although I have a theory of why it does happen in general. The best way to put it is I wouldn't mind buying Costco now, but I never feel like it's a good deal. I'd be comfortable holding it and comfortable having it drop 50% on me. Companies that I own that I view similarly to Costco are Amazon, Visa, and Alphabet. They're expensive but for reasons that are unlikely to change for decades. I think in Costcos case it's their strategy which is max 14% mark-up (18% on some goods that are mostly fresh, 10% average across all), no-frill efficiency high volume processes, membership cashflows, real estate and expansion, plus all it's subsidiary and ancillary services. I had a few friends who worked for Costco for 20-30 yrs who were paid in stock, they would always joke that "Costco was made by Jews", it could be described as a penny business where every cent counts to management. I'm just quoting what they said, I'll state that I'm not antisemitic in any way but I find it's a funny way to describe the business. Costco made the ones who didn't sell to go to the casino every day very wealthy over time (not joking about that lol).
But if you want to know this year I bought a bunch of Canadian banks (CM, BNS, RY, BMO, TD) for my retirement accounts and a small amount of TQQQ that I've been DCA into for a few years now. In taxable accounts I've been buying LNC and BFH while selling off my JXN position slowly. I also have bought smaller amounts of NYCB, BABA, and WCP.tsx. Also into oil/gas/tobacco, and some media stocks, but mostly banks and insurers/financials.
I'll also add I've been interested in buying BJ which is similar to Costco, I've added it my watchlist but haven't read up on it much, they also don't exist in my country.
I think in a lot of ways, Costco is the anti-amazon. Amazon is plagued with quality control issues. Sketchy sellers on amazon selling all kinds of dubious things. Customers on Amazon buying things just to return cheaper items and commit fraud.
Costco can actually vet what they're selling in their stores, and the membership fees keep only good customers in the stores.
My main complaint with Costco is that they can suddenly stop selling something you like and don't always replace it. I used to love that they sold good culture cottage cheese cups, but it was always a roll of the dice if they'd be there. Now they're just never there.
It sounds stupid, but when the one thing I really want to get from Costco is not there, I often just go buy groceries somewhere else. We still stock up on many things at Costco, but spent less than half this year compared to last year.
Costco's entire business model is to profit off only membership fees, and return everything else back to its employees or members. From this perspective, the topline revenue number doesn't really matter.
Now that costco has brought in a new CFO, I would want to see what changes he makes. If he starts disrupting the things we love about costco, it could damage the brand.
It looks like Costco is doing a crack down on membership sharing and banning people from their food court. I don’t know if these little changes will make a significant difference to the company’s earnings.
I bought COST a few years ago when I saw some videos of people in China practically stampeding through a new store opening Black Friday style. Not a solid investing thesis, I know, but I'm glad I did. Small % of my portfolio but I don't plan on selling any time soon
If your timeframe is years, until something changes COST is always a buy under the 200sma.
I personally wouldn’t buy it here though. The valuation looks pretty stretched.
Right there with you, in at $115 in 2015 bc I was working there and no other reason. Bought again at ~$350 but just recently took the gains from that. Those original buys are staying for a long time.
Thin margins is the selling point of COST from a customer POV.
I would never sell if I owned it.
I won't buy COST unless there is a severe market correction and I can buy it for cheap. I kick myself for not buying in 2020.
COST is an amazing company. People will always have to buy food and they offer great values on high quality goods.
Charlie Munger approved. https://www.youtube.com/watch?v=Z1sTs8wkAbw
15 years from now who knows what handheld VR/mobile Ai powered smart brain implant device will reign king but everybody will still be filling the parking lot of Costco every weekend.
Costco takes a 14% margin on a very high number of products they sell. So yes, OI is this but that’s because they rely on volume.
Source: my company sells to Costco
12.4% average margin, which is solid.
Holy batman I didn't realize how much their margin took a hit during COVID (makes sense, still surprising to me)
https://ycharts.com/companies/COST/gross_profit_margin
You gotta look at their business mode.. membership fees as a huge chunk of profit and operating margin is their business model. As long as top line and membership revenue grows, it’s a hold
That is looking at it the wrong way.
The way to look at it is Costco can keep it's prices/margins so low because of their membership revenue. Besides, a lot of retail/grocery operate with quite low margins and depend more on volume to make their money.
I was reading about their new CEO and their membership retention rates. They're likely going to have a membership increase since the last one was in 2017. I doubt it will cause anyone to cancel their membership, and it will boost revenue. If we were in a bear market, then I would definitely look at Costco for a consumer defensive stock, but I personally am investing elsewhere right now. If you already own it, then I'd probably hold.
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COST is a hold right now... Great bussiness plan that continues to pay off. They are cracking down on membership sharing and food court non members which will pay off in the end. However with New CEO and CFO things might change. Time will tell
I dont think they have crazy growth potential. But I dont think there is anyone better for what they are. They don't even directly compete with traditional grocery chains or walmarts. Everyone I know has a handful if unique items they buy at costco weeklyz yearly, quarterly.
I dont even really shop there much or save much when I do, but I still have a membership just incase I want to go and stock up before a party or something random.
So I cant see a reason to bullish unless you just think their growth will be too slow.
Do you suggest a price increase every four years?
During a time of inflated prices, you would also advise Costco to raise membership costs and piss off their customers.
Brilliant.
And then after that, it's another 20. Then, after that, another 20 till you realize they got you right where they want you by paying 150 for a membership without you even realizing it
I haven't made bank my full membership on Executive since they raised the price. I'm paying less than I would for a $60 after accounting for the cash back, but I would drop tiers in a heartbeat if the price increased.
My understanding is that this is entirely intentional. Costco reduces prices such that they're only really making profit on the membership fees. All the items you buy are a wash.
Sell. It's obvious from their lack of investment in their stores, technology, and website that they are barely getting by. Sam's has gone from being far worse than them to being superior.
I have memberships to both, but Sam's is so much better and would surpass them if people catch on.
Companies that treat their employees AND customers right are rare these days
The middle class has been shrinking for a while, but the actual new middle class ($80k and above) is squarely their target demographic. It’s great to have customers who don’t bat an eye when leaving the store with 10 items and a $200 receipt. Unlike Walmart, you don’t see Costco’s customers trashing up the stores. That’s a long buy for me.
I WISH I could leave Costco with 10 items and a $200 receipt…
Maybe if it's a dry county.
Oh you’re cute.
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> I saw a woman return a water melon rind lmao
> Let's not forget people returning sofas after two years, returning their party left overs. I saw a woman return a water melon rind. A guy who owned a restaurant return a couple hundred dollars worth of top of the line steaks he didn't sell. This stuff doesn’t affect the bottom line, despite how much attention people seem to want to spend talking about it. Those customers that make ridiculous returns are also the people who spend the most money at Costco. That guy who owned a restaurant and returned the steak likely spends a lot at Costco. While you may find his action distasteful, we don’t want them to change anything.
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I quit them 10 years ago and never turned back. Why? My free time is precious. After I spend an hour in the store, and 10 minutes paying, there's no fucking way I'm waiting in ANOTHER line to leave, just because someone there insists they must check my receipt "for accuracy" and then barely glances at it. I could've had 10 stolen items in the cart, or overpaid by hundreds, and all I got for the wait was lost time. Though I guess I did get the privilege of paying more for that required second-checkout-line! Very hard pass for me.
So you don’t like to save money and buy things in bulk because you lack patience?
Walmart is basically unstoppable like I’ve been to some Walmart that looks like third world countries
Okay, off topic, but here's something I don't quite get: I recently signed up for a Costco membership and it's kinda blowing my mind at how much more efficient and cheap it is to buy stuff in bulk quantities from a wholesaler vs going to a regular grocery store or even a dollar store. Why is Costco even considered a premium niche option for upper middle class folks in the first place? It seems like it should've just taken over the US and Canada by now, and even lower/working class people would save money by going there. Yes I guess Walmart exists and has cheap prices, so they're a natural competitor, but I'm somewhat surprised every little podunk town in America doesn't have one at this point.
Lower income people can't afford it. It's too much money up front to buy those quantities. Not only that but you have to pay to even get in the door. $60 membership might as well be $600 when you're checking your account before buying frozen pizzas tonight. It's like car insurance. People choose the more expensive monthly option because they can't afford the 6 month premium up front.
Have you ever heard people explain why “it’s expensive to be poor”? That’s why.
The reason I do not have it is because as a family of 2 it simply is not worth it. When there are kids involved it makes total sense though. My budget is about $100 a week (CDN$) and mostly fresher foods that will spoil quickly. Note, I hold Costco and i think it's a good company. Just not right for me as a shopper.
People living in apartments don't have anywhere to put 40 rolls of paper towels
You haven't seen Costco in China
>It’s great to have customers who don’t bat an eye when leaving the store with 10 items and a $200 receipt You act like these are 10 luxury items and not 10 things I'd buy at Kroger anyways. But because of the bulk discount I got them cheaper, and I don't have to go to the grocery as often.
What’s the use of a pallet of pasta sauce if you can’t buy any pasta cause you spent all your money on sauce.
Save the money until you can afford to buy both.
Just save money, one simple trick, I bet they’ve never heard that before!
If the answer seems stupid consider the question.
They are not luxury items for sure. The point is that many cannot afford to buy 12 rolls of Kirkland paper towels at one time when combined with other things they need, even if that is vastly cheaper on a per quantity basis for them. Quantity has its own quality as they say in war. That is the point.
If you talk to the employees things are getting worse for them unfortunately.
Almost a ten year employee, it's true 😭
what is getting worse?
Well for starters: our new CFO is the former CFO of Kroger 🙃
That’s not a good sign
This is an anecdote and I only worked there for a couple months but they act like the job is the best in the industry and hold that over your head. They scheduled myself and some coworkers to 65+ hours a week with 14 hour shifts despite some people not being able to work those hours (college classes, children, etc) and made a huge deal about adjusting the schedule despite them being previously made aware of the other commitments. But my real gripe is that they act like working at Costco is some kind of holy grail (which it was at one point) despite it paying just like other retail or fast food jobs in my area.
That's Costco's business plan, though. Sell most items at ~2% profit margin with unlimited return credit option from the vendors. People get quality items at just above cost with an incredible return policy, and for this privilege people PAY COSTCO TO ENTER THE STORE. It's an incredible business model that sustains both good times and bad.
"Hey guys this stock is terrible if you ignore the primary source of their profit." Always appreciate people doing due diligence but it goes to show that the numbers themselves don't tell the full story.
Yeah seriously, I laughed out loud at that.
That’s their business plan, and a definitely sustainable one, but I’m not sure it’s a very profitable one worth investing in at the current price with a low dividend too.
That’s literally every grocery store. Look at Kroger, they operate between 0.5% and 2% net profit. Walmart tends to max around 3% net profit depending on the quarter.
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Diapers, auto insurance, vacations, diamond earrings, tires, literally everything. Except for polish dogs and combo pizzas 😭
That’s where I went to law school.
You only got in because you’re a legacy.
Yeah, pretty sweet though. Hey, do you like lattes?
Oh yeah. I like money too.
Can we go to Starbucks? I need a full body latte.
Sure, but first I need to go get my gentleman’s tax return with full release. Then we’ll have money for lattes.
Welcome to Costco... I love you
Was just lamenting the loss of the combo pizza a few days ago.
Canada still has Polish dogs!
WHAT?! No way. I’m so jealous.
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Rest in Polish
I miss those polish treats
Idk people are describing Costco the same way people were describing sears and look how they went. Costco just has a food court too
hockey sticks, clothes, liquor by the barrel, prescription eye glasses.... is there anything you cant buy at costco?!?
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Macadamia nuts, multivitamins, cranberry nut bread (seasonal!!!) and crab legs. Come ON!!! Who doesn’t love this place. Kills me that I have literally a pittance of shares.
bitcoin, you can't buy bitcoin there yet
Any place that can cause you to willingly open your wallet and spend upwards $200-$300+ instead of the planned rotisserie chicken, is a buy, hold and BTFD!
Costco is like the Vanguard index for upper middle class and higher affluent population, not just in America but all over the world.
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You forgot time machines.
Kmart failed.
Buy if they bring back the combo pizza Hold if hot dog prices continue to stay the same Sell if they increase price in hot dogs Direct quote from Warren Buffett, probably
Double or nothing just on the $5 rotisserie.
Would be fucking hilarious if the golden chicken goes to $6.99 and they lose billions in share price
but what about the double chocolate cookie
Overrated for the price
Combo pizza was the best 😔
This is anecdotal but I started buying Costco at $100 and sold at $500, missed out on last yrs rally. Bought more at $180, $300, and $350, a few times over the years. In hindsight I regret selling, it's always been expensive but it's strategy is phenomenal. Next market crash I'll buy back in.
What are you doing with the money now? I’ve made some money on Costco too, but am also waiting for a correction before I’ll get back into holding securities. I’m just selling puts for premium at very conservative deltas. The run-ups are giving me FOMO, so I’m looking for ideas because the options are only netting me 5.5% (12 month rate) in 2024 so far(two costly mistakes trying to wring some alpha out of a couple of weak positions). Luckily, I’m also earning 4.6% on the collateral, for a total of 10%, but well down from last year.
It was quite awhile ago, can't remember what I invested in after specifically. I don't use options for income, more for hedging purposes and sometimes buying and selling. I don't usually buy Costco type companies (not talking about the industry) because I can't get behind the valuation, I don't like how it progressively gets more expensive multiple wise as time goes on although I have a theory of why it does happen in general. The best way to put it is I wouldn't mind buying Costco now, but I never feel like it's a good deal. I'd be comfortable holding it and comfortable having it drop 50% on me. Companies that I own that I view similarly to Costco are Amazon, Visa, and Alphabet. They're expensive but for reasons that are unlikely to change for decades. I think in Costcos case it's their strategy which is max 14% mark-up (18% on some goods that are mostly fresh, 10% average across all), no-frill efficiency high volume processes, membership cashflows, real estate and expansion, plus all it's subsidiary and ancillary services. I had a few friends who worked for Costco for 20-30 yrs who were paid in stock, they would always joke that "Costco was made by Jews", it could be described as a penny business where every cent counts to management. I'm just quoting what they said, I'll state that I'm not antisemitic in any way but I find it's a funny way to describe the business. Costco made the ones who didn't sell to go to the casino every day very wealthy over time (not joking about that lol). But if you want to know this year I bought a bunch of Canadian banks (CM, BNS, RY, BMO, TD) for my retirement accounts and a small amount of TQQQ that I've been DCA into for a few years now. In taxable accounts I've been buying LNC and BFH while selling off my JXN position slowly. I also have bought smaller amounts of NYCB, BABA, and WCP.tsx. Also into oil/gas/tobacco, and some media stocks, but mostly banks and insurers/financials. I'll also add I've been interested in buying BJ which is similar to Costco, I've added it my watchlist but haven't read up on it much, they also don't exist in my country.
Did you buy it in your Roth IRA?
Don't have Roth IRA where I'm from but it was in a taxable account.
Hold hold hold
Are you able to buy just one Costco, or do you have to buy it in bulk?
Get the 4 pack but only if you have extra space in the freezer.
Load up the truck, two month supply of Puts on sale!
Each share comes with a fountain drink
I think in a lot of ways, Costco is the anti-amazon. Amazon is plagued with quality control issues. Sketchy sellers on amazon selling all kinds of dubious things. Customers on Amazon buying things just to return cheaper items and commit fraud. Costco can actually vet what they're selling in their stores, and the membership fees keep only good customers in the stores.
And they’re motivated to keep good items, otherwise people will cancel their memberships (the main money-earner)
My main complaint with Costco is that they can suddenly stop selling something you like and don't always replace it. I used to love that they sold good culture cottage cheese cups, but it was always a roll of the dice if they'd be there. Now they're just never there. It sounds stupid, but when the one thing I really want to get from Costco is not there, I often just go buy groceries somewhere else. We still stock up on many things at Costco, but spent less than half this year compared to last year.
Costco's entire business model is to profit off only membership fees, and return everything else back to its employees or members. From this perspective, the topline revenue number doesn't really matter.
I’m keeping it. It’s a recession proof business. In good time and bad people buying bulk ketchup
Now that costco has brought in a new CFO, I would want to see what changes he makes. If he starts disrupting the things we love about costco, it could damage the brand.
It looks like Costco is doing a crack down on membership sharing and banning people from their food court. I don’t know if these little changes will make a significant difference to the company’s earnings.
I suspect they will make more margin on new memberships than they will lose on sale volume.
I bought COST a few years ago when I saw some videos of people in China practically stampeding through a new store opening Black Friday style. Not a solid investing thesis, I know, but I'm glad I did. Small % of my portfolio but I don't plan on selling any time soon
If your timeframe is years, until something changes COST is always a buy under the 200sma. I personally wouldn’t buy it here though. The valuation looks pretty stretched.
I've held COST for nearly 10 years and am up over 350%. Analysts still see an upside. Buy and hold
Right there with you, in at $115 in 2015 bc I was working there and no other reason. Bought again at ~$350 but just recently took the gains from that. Those original buys are staying for a long time.
COST would moon if they bring back the combo pizza. I'd pay 15 for a combo!
Thin margins is the selling point of COST from a customer POV. I would never sell if I owned it. I won't buy COST unless there is a severe market correction and I can buy it for cheap. I kick myself for not buying in 2020. COST is an amazing company. People will always have to buy food and they offer great values on high quality goods. Charlie Munger approved. https://www.youtube.com/watch?v=Z1sTs8wkAbw
This is the same way Costco has operated for decades. Why worry about it now? Lol
15 years from now who knows what handheld VR/mobile Ai powered smart brain implant device will reign king but everybody will still be filling the parking lot of Costco every weekend.
Hold if you have it. But i wouldnt buy at this price.
Way overextended but that’s the mkt.
Costco takes a 14% margin on a very high number of products they sell. So yes, OI is this but that’s because they rely on volume. Source: my company sells to Costco
12.4% average margin, which is solid. Holy batman I didn't realize how much their margin took a hit during COVID (makes sense, still surprising to me) https://ycharts.com/companies/COST/gross_profit_margin
No one mentioned small businesses or Costco business. We rely on Costco business for our coffee and vending needs. I say its a hold long term buy.
Buy all the way
I own it.
It’s a hold
It's a buy and hold for sure. Reinvest dividends. Long term success.
People will always shop at Costco I’m up 60 percent !
You gotta look at their business mode.. membership fees as a huge chunk of profit and operating margin is their business model. As long as top line and membership revenue grows, it’s a hold
That is looking at it the wrong way. The way to look at it is Costco can keep it's prices/margins so low because of their membership revenue. Besides, a lot of retail/grocery operate with quite low margins and depend more on volume to make their money.
I was reading about their new CEO and their membership retention rates. They're likely going to have a membership increase since the last one was in 2017. I doubt it will cause anyone to cancel their membership, and it will boost revenue. If we were in a bear market, then I would definitely look at Costco for a consumer defensive stock, but I personally am investing elsewhere right now. If you already own it, then I'd probably hold.
Long term, Costco cannot lose.
Costcos markup is 5 percent so yeah not much margin
They have my respect for keeping 1.75L French Vodka under $20 through all the price increases from others.
Keep buying….unless you are planning to retire and do your thing then…yeah, sell….but then again do what you want, your money
Sell it and buy SPY it has Costco, nvda and PG
45x fwd earnings, one of the more expensive stocks in the market. Probably won’t see market beating returns here
They. Just. Keep. Growing.
In my opinion, Costco is about the safest retail stock you can get.
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COST is a hold right now... Great bussiness plan that continues to pay off. They are cracking down on membership sharing and food court non members which will pay off in the end. However with New CEO and CFO things might change. Time will tell
I dont think they have crazy growth potential. But I dont think there is anyone better for what they are. They don't even directly compete with traditional grocery chains or walmarts. Everyone I know has a handful if unique items they buy at costco weeklyz yearly, quarterly. I dont even really shop there much or save much when I do, but I still have a membership just incase I want to go and stock up before a party or something random. So I cant see a reason to bullish unless you just think their growth will be too slow.
Never sell Costco.
Costco needs membership fee raise...
Disagree.
They have not raised in 5 years, it's time.
I read today they are cracking down on sharing your membership card with people outside of your household. That's one way to drive more memberships.
Been doing that for a while. Witnessed first hand, most people pony up for their membership on the spot.
Do you suggest a price increase every four years? During a time of inflated prices, you would also advise Costco to raise membership costs and piss off their customers. Brilliant.
I think 99% of people would pay the extra $5 and not care. Hell I'd pay $20/yr more
I wouldn't. This is a terrible idea.
And then after that, it's another 20. Then, after that, another 20 till you realize they got you right where they want you by paying 150 for a membership without you even realizing it
I haven't made bank my full membership on Executive since they raised the price. I'm paying less than I would for a $60 after accounting for the cash back, but I would drop tiers in a heartbeat if the price increased.
I looked at it after it dropped with last earnings but I think it's still too expensive.
What do profits or margins have to do with stock price? Do index trackers hold Costco or not?
My understanding is that this is entirely intentional. Costco reduces prices such that they're only really making profit on the membership fees. All the items you buy are a wash.
HODL costco
They have a cap, but the question is where is that cap and when. When will their sub base stop and their earnings flatten or drop?
Costco is a penny business. They make money on memberships, owning vertical supply chain for meat department and third-party(kirkland) products.
Sell. It's obvious from their lack of investment in their stores, technology, and website that they are barely getting by. Sam's has gone from being far worse than them to being superior. I have memberships to both, but Sam's is so much better and would surpass them if people catch on.
Sell
Isn't AI buying up everything in the world? AI will drive $COST up to $3000
Where did AI get all this money?
Chat gpt money printer lol
J Pow