Can Costco (COST) Continue Its Trend of Beating Earnings Expectations?

Costco: Consistent Earnings Outperformance and Positive Outlook

If you’re searching for a stock with a proven record of surpassing earnings forecasts and strong prospects for continuing this trend, Costco (COST) deserves your attention. As a key player in the Zacks Retail - Discount Stores sector, Costco appears well-positioned for another potential earnings beat.

Reviewing the company’s recent performance, Costco has consistently exceeded analyst expectations in its last two earnings announcements, averaging a 1.46% positive surprise over those quarters.

In the most recent quarter, Costco reported earnings of $4.34 per share, outpacing the Zacks Consensus Estimate of $4.26—a 1.88% surprise. The prior quarter saw actual earnings of $5.87 per share versus an expected $5.81, resulting in a 1.03% beat.

Share Price and Earnings Surprises

Given this track record, analyst estimates for Costco have been trending upward. The company’s positive Earnings ESP (Expected Surprise Prediction) is a promising indicator, especially when paired with a favorable Zacks Rank.

According to Zacks research, stocks that combine a positive Earnings ESP with a Zacks Rank of #3 (Hold) or better deliver a positive earnings surprise nearly 70% of the time. In practical terms, out of 10 such stocks, as many as seven could outperform consensus estimates.

The Earnings ESP metric compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter. The Most Accurate Estimate reflects the latest analyst revisions, which often incorporate the most current information available before an earnings release, potentially making them more reliable than earlier projections.

Currently, Costco’s Earnings ESP stands at +0.68%, indicating growing analyst optimism about the company’s upcoming results. This, combined with its Zacks Rank #3 (Hold), suggests another earnings beat may be on the horizon. The next earnings report is anticipated on March 5, 2026.

It’s important to note that a negative Earnings ESP does not guarantee an earnings miss, but it does lessen the predictive strength of this metric.

While many companies manage to exceed consensus EPS estimates, this alone doesn’t always drive their stock prices higher. Conversely, some stocks may remain stable even if they fall short of expectations.

For this reason, reviewing a company’s Earnings ESP before its quarterly report can help improve your investment decisions. Consider using the Earnings ESP Filter to identify promising stocks to buy or sell ahead of earnings announcements.

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Access the Free Costco Wholesale Corporation (COST) Stock Analysis Report

Originally published by Zacks Investment Research

Zacks Investment Research