Costco Wholesale Corporation, together with its subsidiaries, engages in the operation of membership warehouses in the United States, Puerto Rico, Canada, Mexico, Japan, the United Kingdom, Korea, Australia, Taiwan, China, Spain, France, Iceland, New Zealand, and Sweden. The company offers branded and private-label products in a range of merchandise categories. It offers merchandise, such as sundries, dry groceries, candies, coolers, freezers, deli, liquor, and tobacco; appliances, electronics, health and beauty aids, hardware, garden and patio products, sporting goods, tires, toys and seasonal products, office supplies, automotive care products, postages, tickets, apparel, small appliances, furniture, domestics, housewares, special order kiosks, and jewelry; and meat, produce, service deli, and bakery products. The company also operates gasoline, pharmacies, optical, food courts, hearing-aid centers, and tire installation centers; and offers business delivery, travel, grocery, and various other services online. It also operates e-commerce websites. The company was formerly known as Costco Companies, Inc. and changed its name to Costco Wholesale Corporation in August 1999. Costco Wholesale Corporation was founded in 1976 and is based in Issaquah, Washington.

Costco Wholesale Corporation

Key Points
Its sheer size gives the retailer unfair advantages.
Low-cost consumer goods are also always marketable in any environment.
Despite what seems to be an “old-school” business model, Walmart’s business is actually quite modern.
It's certainly not the most exciting of potential stock picks. Last quarter's revenue growth of 4.8% (or 5.6% when adjusting for currency fluctuation) is in line with the company's long-term norms, in fact.
Nevertheless, retailer Walmart (NYSE: WMT) is a solid prospect for almost any investor's portfolio. Here are the top five reasons it might belong in yours as well.
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1. It dominates the retail landscape
To say Walmart is a major brick-and-mortar retailer still understates what the company is. It's the United States' -- as well as the world's -- single-biggest biggest retailer, operating more than 5,200 domestic locales plus nearly 5,600 more stores outside of the United States that collectively did $681 billion worth of business last year, trouncing next-nearest Costco's figure of $254 billion. That's even more sales than e-commerce giant Amazon (NASDAQ: AMZN) reported for 2025.
In other words, Walmart dominates the retail landscape.
Being bigger doesn't mean it's inherently better, of course. Size does have its clear advantages though. For instance, its suppliers and vendors cater to the needs of their most important distributor, and the company itself can use its scale to negotiate good prices -- and pass those savings along to its customers.
It may not be fair to other retailers. Investors don't want a fair fight, though. They want to own the strongest name in any industry, since strength makes it easier to continue dominating.
2. It thrives in any and all environments
Many consumer-facing businesses are cyclical. For example, people purchase fewer new automobiles when they're feeling cash-strapped or fear losing a job. Or they're less likely to take an extravagant vacation in the middle of a recession.
This isn't a dynamic that applies to Walmart, though. Being the low-price leader for a wide range of basic consumer goods and consumables means it's a go-to option when times are tough. Over the course of the past few inflation-riddled years, in fact, the company frequently touted how most of its market share gains were being made with households earning in excess of $100,000 per year specifically because of the value it offers its shoppers.
Or look at it like this. With the exception of one soft patch in 2015 (when it was suffering some significant labor-related challenges) Walmart hasn't failed to report at least some degree of quarterly sales growth since at least 2010.
3. Walmart is (mostly) debt-free
When interest rates were as low as they were for the better part of the past 17 years, a company's debt load didn't matter much simply because interest charges didn't really eat into earnings. Now that rates are back near multi-decade highs, however, any debt racked-up during this time has become an expensive nuisance.
Walmart's an exception to this dynamic, though. See, it doesn't have a lot of debt on its books. As of the end of July, it's only got $35.6 billion worth of long-term obligations on its balance sheet that are costing it roughly $2.3 billion per year. For perspective, the company's recent annual net income has been in the ballpark of $11 billion, while its total assets are $254 million and its market cap is a massive $800 billion.
This minimal debt burden means Walmart enjoys the fiscal flexibility of investing more money in its own growth -- an edge that many of its smaller and more-debt-burdened competitors don't have.
4. Consistent stock repurchases bolster shareholder gains
The world's biggest brick-and-mortar retailer may not produce much net growth in any given year. That doesn't mean shareholders' stakes are only making an average annual gain of 5%, though. Walmart's consistent profitability is being used to add shareholder value in a different way. That's through stock buybacks, which reduce the total number of outstanding shares, thus making the remaining ones more valuable. Since 1995, the total number of WMT shares has nearly been halved.
The total number of shares being taken out of circulation has slowed since 2020. Don't misinterpret the graphic above, though. The company's spending as much money on stock repurchases as it ever has. It's just not been able to buy back as many shares as it historically has due to the stock's sizable price increase since 2019.
5. It's willing and able to evolve -- and is doing so
Finally -- and perhaps most important -- buy Walmart stock because the company is willing and able to evolve its business. It's proactively doing so, in fact.
There was a time when simply opening its doors and offering consumers everything they might need was good enough. Not anymore, though. Competition is fierce. Not only is Amazon an obvious threat, but Dollar General and Dollar Tree stores appear to still be popping up everywhere. Walmart can't simply rest on its laurels.
And it isn't.
While not every experiment it's tried has panned out as hoped (the world's not quite ready for Walmart-branded healthcare clinics, for instance), many of them have.
For example, online shopping now accounts for nearly one-fifth of the company's total sales, and just last year Walmart collected $4.4 billion worth of high-margin advertising revenue from sellers looking to more promote their goods being sold via a Walmart-operated e-commerce platform. Its Walmart+ program continues to add paying subscribers, giving these members perks like free next-day shipping of online orders, or in some case, same-day deliveries.
Meanwhile, although it's more qualitative than quantitative, Walmart shoppers are now seeing in-store displays and brand-focused presentations that look like something you'd expect to find in more conventional department stores such as Macy's or JCPenney.
In short, Walmart understands that if it doesn't offer solutions that serve consumers' specific lifestyles, one of its rivals will.
Bottom line
So it's a must-have for all investors? Not necessarily. If you crave massive growth and can tolerate any reasonable degree of risk, you may ultimately be dissatisfied by holding a stake in the world's biggest retailer.
If you're looking for a lower-risk name with good value and proven long-term growth prospects, though, Walmart is a solid pick despite its frothy valuation of nearly 40 times this year's expected per-share earnings of $2.63. Sometimes the premium you pay for quality is well worth it.
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James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Costco Wholesale, and Walmart. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

5 Reasons to Buy Walmart Stock Like There's No Tomorrow

It’s been almost a week since Lululemon’s LULU lackluster Q2 report led to a sharp decline in its stock, hitting a new 52-week low of $162 a share. Although Lululemon was able to exceed Q2 earnings expectations, the leading athletic apparel company slashed its full-year guidance, with a major factor being a $240 million hit from tariffs.
This has raised concerns about the effects of a challenging macro environment on other active-wear apparel companies, including Nike NKE, which is scheduled to report results for its fiscal first quarter on Tuesday, September 30.
Like Lululemon, Nike's stock has been submerged in volatility, climbing off a one-year low of $52 a share but still 19% from a 52-week peak of $90. Furthermore, NKE is more than 50% below its all-time high of $167, with LULU trading 67% beneath its record peaks of $511.
Despite their grizzly stock performances in recent years, let’s see if now is an opportune time to invest in either of these leading apparel retailers for a sharp rebound.
Image Source: Zacks Investment Research
Stale Product Lines & Lululemon’s Surprising Competitors
Offering high-quality activewear and footwear, both brands compete directly in the athletic apparel market, but Lululemon has faced increased competition from unlikely competitors that appear to be disrupting its core business. Simarlar to Nike, Lululemon’s management has admitted that its product lines have become stale and is racing to fast-track new designs.
Centered around its yoga-inspired athleisure gear, Lululemon’s same-store sales fell 4% during Q2 in its core North American market. Notably, several analysts and CNBC contributor Jim Cramer pointed to surprising scenarios/competitors for the disruption, such as more affordable jogger brands offered by Costco COST and The Gap GAP.
While it wasn’t enough to offset domestic concerns, Lululemon's international sales surged last quarter, with China segment sales up 25% and collective markets in the rest of the world up 19%. Still, Lululemon is being impacted by the removal of the de minimis exemption, which previously allowed smaller international shipments to bypass tariff duties. Raising more fears regarding margin pressures and its stale product line, Lululemon’s inventory ballooned 21% year over year to $1.7 billion.
Image Source: Zacks Investment Research
Nike’s Leadership Overhaul & Strategic Pivot
Facing a growing number of competitors outside of Adidas ADDYY, Nike has undergone a leadership change with long-term executive Elliott Hill taking over as President and CEO in 2024. Having more than 30 years of experience with Nike, Hill has refocused the iconic sports brand on its core strengths after a tech-centric strategy misfired.
Pouring resources into digital ads and performance marketing, Nike still experienced a drop-off in digital sales and alienated partners like Foot Locker and Macy’s M in a bid to boost its direct-to-consumer (DTC) reach on Nike.com. It’s noteworthy that Nike’s inventory remained flat during its most recent fiscal fourth quarter, and expects to have a “clean” inventory position by the first half of its current fiscal year 2026.
Aiming to rebuild relationships with third-party vendors, Hill has refocused Nike on wholesale distribution, product innovation, and storytelling campaigns. Plus, Nike has announced plans to shift manufacturing away from China, aiming to reduce exposure to tariffs that could cost up to $1 billion. Stating that the brunt of the tariff impact may be behind it, Nike’s leadership has implemented a four-pronged plan that also includes negotiating with suppliers and retailers to share the cost burden, while cutting corporate costs and selectively raising prices in the U.S.
Nike is better suited to handle Tarriff headwinds
While Lululemon’s immense profitability has wowed investors at times, it doesn’t take Captain Obvious to realize that Nike may be better suited to handle tariff headwinds. Even with Nike facing higher tariff costs, the company is projected to bring in over $40 billion in annual sales for the foreseeable future, compared to Lululemon’s forecast of $11 billion or more.
That said, Nike is generally better positioned to handle tariffs than Lululemon thanks to its supply chain maturity as well. Having a deeper global infrastructure, Nike has diversified manufacturing from multiple countries outside of China, including Vietnam, Indonesia, and India. Lululemon, on the other hand, is more vulnerable to sudden policy shifts and cost spikes as it relies heavily on Canadian and Vietnamese factories.
Image Source: Zacks Investment Research
Conclusion & Final Thoughts
Being further along in its turnaround strategy, a rebound looks more likely for Nike stock, as there could still be more short-term weakness ahead for Lululemon shares. Of course, Lululemon will need to overcome tariff uncertainties, but one thing it can learn from Nike as it undergoes an apparel renovation of its own, is that tech is not always a substitute for product relevance, retail relationships, or emotional brand storytelling that resonates with consumers.
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Nike vs. Lululemon: Is Either Apparel Stock Due for a Sharp Rebound?

In trading on Friday, shares of Costco Wholesale Corp (Symbol: COST) crossed above their 200 day moving average of $500.76, changing hands as high as $507.35 per share. Costco Wholesale Corp shares are currently trading up about 0.9% on the day. The chart below shows the one year performance of COST shares, versus its 200 day moving average:
Looking at the chart above, COST's low point in its 52 week range is $406.5101 per share, with $612.27 as the 52 week high point — that compares with a last trade of $502.68. The COST DMA information above was sourced from TechnicalAnalysisChannel.com
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ETFs Holding STS
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Costco Wholesale (COST) Shares Cross Above 200 DMA

BJ's Wholesale Club Holdings, Inc. BJ is stepping firmly into the digital era as its latest quarter underscores the growing importance of technology in shaping member engagement. In the second quarter of fiscal 2025, digitally enabled comparable sales climbed 34% year over year, with two-year stacked growth of 56%. Services like buy online pick up in club, same-day delivery and ExpressPay have been central to this momentum, integrating e-commerce with the company’s physical footprint.
Management highlighted that more than 90% of digital orders are fulfilled by clubs. The company sees digitally engaged members as twice as valuable compared to in-club-only shoppers due to larger basket sizes and stronger renewal rates. The app has become the primary touchpoint. More than half of active members now use it regularly to clip coupons, locate products or preorder deli items. This explains why membership fee income reached a record $123.3 million in the second quarter, up 9% from last year.
Importantly, the digital push aligns with BJ's Wholesale Club’s broader goal of driving convenience and improving member retention. With membership climbing to a record 8 million and higher-tier penetration hitting 41%, management views digital integration as central to sustaining growth. As macro pressures shape consumer habits, BJ’s focus on omnichannel convenience positions it well to remain relevant.
BJ's Wholesale Club is continuing to invest in digital capabilities and sees this as a cornerstone for future growth, especially as consumer preferences shift toward hybrid retail experiences.
Digital Growth at Walmart and Costco
Walmart Inc. WMT is aggressively scaling its digital ecosystem with second-quarter fiscal 2026 e-commerce sales soaring 25% globally, led by 26% growth in Walmart U.S. and Sam’s Club. Walmart highlighted that store-fulfilled pickup and delivery rose nearly 50%, while membership income and advertising revenues surged in double digits, reinforcing its omnichannel model. AI investments, including the launch of Sparky, Walmart’s AI assistant, aim to further personalize the shopping experience.
E-commerce continued to stand out for Costco Wholesale Corporation COST with comparable sales climbing 13.6% for the fourth quarter of fiscal 2025, or 13.5% after adjusting for fuel and currency impacts. Momentum was even stronger in August, when the metric surged 18.4%. For the fiscal year, Costco reported e-commerce comparable sales growth of 15.6%, reinforcing the importance of the company’s investments in omnichannel capabilities. Costco continues to integrate online and in-club experiences, using digital tools to boost convenience and member loyalty.
What the Latest Metrics Say About BJ's Wholesale Club
BJ's Wholesale Club stock has risen 24.7% over the past year, against the industry’s decline of 10.4%.
Image Source: Zacks Investment Research
From a valuation standpoint, BJ's Wholesale Club’s forward 12-month price-to-earnings ratio stands at 21.81, higher than the industry’s ratio of 20.12. BJ carries a Value Score of B.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for BJ's Wholesale Club’s current financial-year sales and earnings per share implies year-over-year growth of 4.9% and 6.7%, respectively.
Image Source: Zacks Investment Research
BJ's Wholesale Club currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Is BJ's Wholesale Becoming a Digital Powerhouse in Retail Clubs?

Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the iShares Russell 1000 Growth ETF (Symbol: IWF) where we have detected an approximate $198.8 million dollar inflow -- that's a 0.2% increase week over week in outstanding units (from 260,950,000 to 261,400,000). Among the largest underlying components of IWF, in trading today Mastercard Inc (Symbol: MA) is trading flat, Costco Wholesale Corp (Symbol: COST) is down about 0.1%, and Intuit Inc (Symbol: INTU) is higher by about 0.8%. For a complete list of holdings, visit the IWF Holdings page » The chart below shows the one year price performance of IWF, versus its 200 day moving average:
Looking at the chart above, IWF's low point in its 52 week range is $308.67 per share, with $452.81 as the 52 week high point — that compares with a last trade of $446.08. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Also see:
Funds Holding FUV
BSJR YTD Return
LECO market cap history
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

IWF, MA, COST, INTU: Large Inflows Detected at ETF

Among the underlying components of the S&P 500 index, we saw noteworthy options trading volume today in Costco Wholesale Corp (Symbol: COST), where a total of 15,246 contracts have traded so far, representing approximately 1.5 million underlying shares. That amounts to about 68% of COST's average daily trading volume over the past month of 2.2 million shares. Particularly high volume was seen for the $930 strike put option expiring September 05, 2025, with 868 contracts trading so far today, representing approximately 86,800 underlying shares of COST. Below is a chart showing COST's trailing twelve month trading history, with the $930 strike highlighted in orange:
Microsoft Corporation (Symbol: MSFT) saw options trading volume of 141,827 contracts, representing approximately 14.2 million underlying shares or approximately 66.6% of MSFT's average daily trading volume over the past month, of 21.3 million shares. Especially high volume was seen for the $530 strike call option expiring September 19, 2025, with 20,745 contracts trading so far today, representing approximately 2.1 million underlying shares of MSFT. Below is a chart showing MSFT's trailing twelve month trading history, with the $530 strike highlighted in orange:
And Dollar Tree Inc (Symbol: DLTR) options are showing a volume of 19,454 contracts thus far today. That number of contracts represents approximately 1.9 million underlying shares, working out to a sizeable 65.1% of DLTR's average daily trading volume over the past month, of 3.0 million shares. Particularly high volume was seen for the $90 strike put option expiring September 05, 2025, with 2,400 contracts trading so far today, representing approximately 240,000 underlying shares of DLTR. Below is a chart showing DLTR's trailing twelve month trading history, with the $90 strike highlighted in orange:
For the various different available expirations for COST options, MSFT options, or DLTR options, visit StockOptionsChannel.com.
Also see:
Highest Yielding BDCs
MDV Videos
AGN Videos
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Notable Tuesday Option Activity: COST, MSFT, DLTR

Costco Wholesale Corporation’s COST last reported quarter painted a compelling picture with strong traffic growth that could be an important signal for the holiday season. Comparable traffic, or shopping frequency, increased 5.2% worldwide in the third quarter of fiscal 2025, with a slightly higher 5.5% jump in the United States.
This metric suggests that, despite a challenging consumer environment, Costco's value proposition remains strongly appealing to its members. The company's strategic initiatives, such as reducing prices on key items and extending gas station hours, have not only attracted more shoppers but also led to increased gallon sales. Costco is rolling out faster checkout options and promoting digital wallet use, moves aimed at easing congestion during peak holiday weeks.
The steady rise in foot traffic, along with a 2.7% jump in adjusted comparable ticket (excluding the impact of changes in gasoline prices and foreign exchange), indicates that members are visiting more frequently and spending more on each visit. While uncertainty related to the economic landscape and global tariffs remains, Costco remains confident about providing value to its customers.
Digital channels are also playing a key role in driving traffic. Costco Logistics deliveries of big and bulky items surged 31% year over year in the last reported quarter, while options like Buy Now, Pay Later are giving shoppers more flexibility. Online sales were up 14.8% and site traffic climbed 20% in the last quarter.
With traffic building and systems in place to handle the rush, Costco appears well-positioned to meet holiday demand.
Costco Traffic Momentum Compared With Walmart & Target
Walmart Inc. WMT continues to post steady traffic gains, with U.S. comparable sales up 4.6% in the second quarter of fiscal 2026, driven by strength in grocery, health & wellness, and improving general merchandise trends. Walmart’s U.S. e-commerce sales climbed 26%, fueled by nearly 50% growth in store-fulfilled delivery, where about one-third of orders were completed within three hours.
Target Corporation TGT showed early signs of recovery after sluggish first-quarter fiscal 2025 results. While Target’s second-quarter sales fell 0.9% year over year, traffic trends improved meaningfully, especially in stores. Target registered an increase of 4.3% in comparable digital sales, fueled by robust same-day delivery and growth in Drive Up.
Walmart’s accelerating traffic and Target’s improving in-store momentum highlight a competitive retail landscape where holiday traffic could be a decisive factor.
What the Latest Metrics Say About Costco
Costco stock has risen 7.3% over the past year, outpacing the industry’s growth of 5.8%.
Image Source: Zacks Investment Research
From a valuation standpoint, Costco's forward 12-month price-to-earnings ratio stands at 52.48, higher than the industry’s ratio of 31.72. COST carries a Value Score of D.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Costco’s current financial-year sales and earnings per share implies year-over-year growth of 8.1% and 11.6%, respectively.
Image Source: Zacks Investment Research
Costco currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Does Traffic Growth Signal a Strong Holiday Setup for Costco?

Back-to-school and college is one of the busiest shopping seasons (mid-July to mid-September) in the United States. As of early July,about 67% of back-to-school and college shoppers have already started buying items for the upcoming school year, according to the National Retail Federation (NRF).
This marks an increase from 55% last year and represents the highest level since NRF began tracking early shopping in 2018, the NRF article indicated. Half of families fear rising prices from tariffs, and that’s why they started shopping earlier, per the above-mentioned NRF article.
Where Will Shopping Spent Go?
For college students and parents, the popular back-to-school shopping destinations are online (48%), discount stores (36%), department stores (35%) and college bookstores (27%). K-12 shoppers have a budget of $295.81 on average for electronics ($13.5 billion total), $249.36 for clothing and accessories ($11.4 billion total), $143.77 for school supplies ($6.6 billion total), and $169.13 for shoes ($7.8 billion total), according to the above-mentioned NRF article.
The top five categories for college spending include $309.50 on average for electronics ($20.7 billion total), $191.39 for dorm or apartment furnishings ($12.28 billion total), $166.07 on clothing and accessories ($11.1 billion total), $140.24 on food ($9.4 billion total) and $117.95 on shoes ($7.9 billion total), according to the above-mentioned NRF article.
Stocks to Play
Costco Wholesale COST
Costco Wholesale Corporation sells high volumes of food and general merchandise (including household products and appliances) at discounted prices through membership warehouses. The Zacks Rank #3 (Hold) stock comes from the Retail - Discount Stores industry. The stock has a good VGM Score of B.
Lowe's Companies LOW
Zacks Rank #3 Lowe’s has evolved as one of the world’s leading home improvement retailers, offering services to homeowners, renters and commercial business customers. Lowe’s has all the essentials for going back to campus and making one feel at home. The stock has an upbeat VGM Score of A.
Ambarella AMBA
Ambarella Inc. develops video compression and image processing semiconductors, which enable high-definition or HD video capture, sharing and display. The Zacks Rank #3 company hails from the Electronics – Semiconductors industry.
Amazon.com AMZN
Amazon.com is one of the largest e-commerce providers, with sprawling operations in North America, now spreading across the globe. The Zacks Rank #3 company hails from the Internet - Commerce industry.
ETFs to Buy
ProShares Online Retail ETF ONLN
Online shopping is one of the most-favored forms of shopping now. The underlying ProShares Online Retail Index is a specialized retail index that tracks retailers principally selling online or through other non-store channels. The fund charges 58 bps in fees and yields 0.65% annually.
VanEck Retail ETF RTH
The underlying MVIS US Listed Retail 25 Index tracks the overall performance of companies involved in retail distribution, wholesalers, online, direct mail and TV retailers, multi-line retailers, specialty retailers, and food and other staples retailers. The fund charges 35 bps in fees and yields 0.70% annually.
Invesco Food & Beverage ETF PBJ
As collegegoers are likely to spend on food, this ETF has a chance of going up. The underlying Dynamic Food & Beverage Intellidex Index comprises stocks of 30 U.S. food and beverage companies. These are companies primarily engaged in the manufacture, sale or distribution of food and beverage products, agricultural products and products related to the development of new food technologies. The fund charges 62 bps in fees and yields 1.68% annually.
VanEck Semiconductor ETF SMH
As electronics sales are on the rise on occasions like this, one should note that the pillar of electronics, i.e., semiconductors, is expected to see higher demand. The underlying MVIS US Listed Semiconductor 25 Index tracks the overall performance of companies involved in semiconductor production and equipment. The fund charges 35 bps in fees and yields 0.37% annually.
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How to Play Back-to-School Season With ETFs & Stocks

Walmart Inc.’s WMT second-quarter fiscal 2026 results underscore the company’s strong sales momentum. Revenues rose 5.6% in constant currency, fueled by e-commerce growth and solid performance in the United States and internationally. Yet, adjusted operating income inched up just 0.4% in constant currency, held back by a 560-basis-point drag from higher general liability claims.
Reflecting demand resilience, management raised its full-year sales outlook to 3.75%-4.75%, up from 3%-4%, and lifted adjusted EPS guidance to $2.52-$2.62, supported by reduced currency headwind (now 2-3 cents versus 5 cents earlier). However, Walmart kept its forecast for adjusted operating income growth unchanged at 3.5%-5.5% in constant currency, signaling caution despite accelerating top-line trends.
Profitability remains constrained by expense pressures. The company booked an additional $450 million in liability claim costs during the second quarter, bringing the year-to-date impact to $730 million. Management noted claims inflation will persist in the second half, though at a slower pace, while tariffs and an unfavorable merchandise mix continue to weigh on margins.
Still, Walmart is gaining traction in businesses that could bolster profitability over time. Advertising revenues surged nearly 50% globally, including 31% growth in Walmart Connect U.S. (excluding VIZIO), while membership income advanced 15%. E-commerce economics also improved, with marketplace penetration and delivery efficiencies supporting better margins.
Walmart has shown it can boost sales, making margin recovery the main focus moving forward.
What Latest Metrics Say About Walmart
Walmart, which competes with Costco Wholesale Corporation COST and Target Corporation TGT, has been a standout performer, with shares rallying 25.6% in the past year, almost in tandem with the industry’s growth of 25.8%. Shares of Costco have advanced 5.7%, while Target declined 37.5% in the aforementioned period.
Image Source: Zacks Investment Research
From a valuation standpoint, Walmart's forward 12-month price-to-earnings ratio stands at 34.84, higher than the industry’s 31.98. WMT carries a Value Score of C. Walmart is trading at a premium to Target (with a forward 12-month P/E ratio of 12.19) but at a discount to Costco (52.49).
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Walmart’s current financial-year sales and earnings per share implies year-over-year growth of 4% and 3.6%, respectively.
Image Source: Zacks Investment Research
Walmart currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Walmart Raises Sales Guidance: Will Margins Catch Up Next?

Key Points
Despite numerous macro headwinds, Costco’s net sales are substantially higher than before the pandemic.
Disney is already a dominant force in the streaming world, and its theme parks are a major moneymaker.
Valuation is the deciding factor when choosing the best stock to buy.
Investors can jump-start their research process by identifying companies they might be customers of. For example, you might shop at a Costco (NASDAQ: COST) for groceries and other merchandise. You might watch content from Walt Disney (NYSE: DIS) or plan a trip to one of its parks. Thinking like a customer can provide firsthand knowledge that is valuable in the decision-making process.
These two consumer-facing businesses each possess their own investment merits. But which one is the best stock to buy right now?
Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »
Costco: Dominating retail, but at an expensive valuation
Costco's financial performance in recent years highlights its steady and dependable nature. Between fiscal 2019 and fiscal 2024 (ended Sept. 1), the company's net sales increased at a compound annual rate of 10.8%. This time frame included the COVID-19 pandemic, supply chain issues, surging inflation, rising interest rates, changing trade policies, and today's general economic uncertainty. Same-store sales gains have continued into this year.
With Q3 2025 (ended May 11) net sales of $62 billion, Costco is the third-biggest retailer in the world. But compared to its peers, which sell a massive number of different goods, each of this company's warehouses on average carries about 4,000 stock-keeping units. As a result, Costco has a major cost advantage, flexing its negotiating power with its suppliers to obtain favorable pricing.
Those cost savings go to shoppers in the form of constantly low prices. These customers are then inclined to spend more money at Costco. This further reinforces the company's cost advantage.
If the compelling shopping experience wasn't enough to entice customers, Costco's membership model does. On a global level, these had a 90.2% renewal rate in the third quarter. They drive loyalty and repeat visits, while bringing in a high-margin revenue stream.
Costco is a fine business. And the investment community knows it, bidding up the valuation to incredible heights. Shares trade at a price-to-earnings (P/E) ratio of 53.9. In the past 25 years, Costco's valuation has rarely been more expensive. Investors must consider these lofty expectations embedded in the stock price.
Disney: Putting streaming at the forefront
Disney is undoubtedly a leader in the media and entertainment landscape. But its cable networks are in secular decline. Revenue in this segment fell 15% year over year in Q3 (ended June 28), as operating profit dropped 28%. As households continue to ditch their cable subscriptions, there will be pressure here.
However, Disney has been successful in positioning the business for a streaming future. It launched Disney+ in November 2019. Combined with Hulu, the company's direct-to-consumer streaming operations have 183 million subscribers (this excludes ESPN), up 1% from three months prior. This drove a 6% year-over-year revenue gain.
The business just launched its highly anticipated flagship ESPN streaming service, which provides sports fans with a more comprehensive offering with interactive and personalized features. "The enhanced ESPN App will be a sports fan's dream," CEO Bob Iger said.
Disney's most lucrative segment, though, is Experiences. This includes the theme parks, cruise lines, and consumer products. In Q3, it posted a 27.7% operating margin. Management believes there are 700 million people across the globe with "high Disney affinity" that haven't visited a park yet.
Given this estimate, it makes sense that Disney is investing aggressively to add new attractions at its parks, while expanding its cruise fleet. This should allow the company to serve more customers in the future, which could then benefit the media segments by attracting more subscribers.
Investors can buy Disney shares at a P/E multiple of 18.5. While the company is certainly more cyclical than Costco, I believe the House of Mouse is the best stock to buy of these two options. Over the next five years, Disney has greater upside than the extremely expensive Costco shares.
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Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale and Walt Disney. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Indicator	TTM Median
P/E	59.28 20.90
Price/Sales	1.71 0.83
P/B	17.61 1.82
P/FCF	65.19 19.11

Indicator	TTM Median
ROE	31.95 13.30
ROA	10.72 5.85
ROI	25.71 9.19
Net Worth	451.53 1.38
Quick Ratio	0.49 0.86
Current Ratio	1.00 1.37

Indicator	TTM Median
Net Profit Margin	2.89 5.78
Operating Margin	3.69 9.26
Gross Margin	12.67 34.60
Return on tangible equity	31.95 24.12

Indicator	TTM Median
EPS	4.28 0.51
EPS Forecast	4.25 0.41
Revenue	63.72B 141.00M
Gross Profit	7.98B —
EBITDA	2.87B —

Costco Wholesale Corporation

TTM metrics for the latest quarter under IFRS and their historical dynamics

Valuation

Debts

Efficiency

Other ratios

Revenue