Costco's fourth-quarter comparable sales rose 6.7% excluding fuel and foreign-exchange effects, compared with Walmart's second-quarter 3.4% growth after adjusting for federal drug-price rules. Costco revenue increased 11.1% to $95.7 billion, above estimates.
Costco's earnings per share rose 15% to $6.75, including a $0.15-per-share benefit from tariff refunds, equivalent to nearly $70 million. Membership-fee revenue grew 7.3%, its third consecutive quarter of slowing growth in that category, while e-commerce sales rose 19.5%.
The article's case for Costco also cites ongoing store openings and fewer than 1,000 locations worldwide as room for expansion. It calls the stock a better buy despite its higher valuation: Costco trades at a price-to-earnings ratio of 43, versus Walmart's 39, and may take time to grow into that valuation.
