Costco shares lag S&P 500 despite 7.1% same-store sales growth

Costco shares have declined 0.8% since April 2026, trading at $979.55, while the S&P 500 index gained 9.7% over the same period. The membership-only retailer, which operates on NASDAQ under the ticker COST, sells groceries, apparel, toys, and household items, often in bulk quantities, to suburban consumers.

The company reported $303.2 billion in revenue over the past 12 months. This scale provides Costco with an advantage in distribution and allows it to leverage fixed costs more effectively than smaller competitors, enabling lower prices for customers. However, this scale acts as a constraint on growth because there is a limited amount of real estate available for new store construction. To accelerate sales, Costco may need to optimize pricing or pursue international expansion.

Same-store sales, a key performance indicator for organic growth in brick-and-mortar shops operating for at least a year, have shown strong performance for Costco. The company posted an average year-on-year same-store sales growth of 7.1% over the last two years, driven by high demand within its existing locations. In contrast, total sales grew at a compounded annual growth rate of 7.8% over the last three years. This three-year growth rate is considered mediocre compared to the broader consumer retail sector.

Despite these mixed signals regarding long-term growth rates, Costco remains a major player in the consumer retail sector. The stock has trailed the market in recent months. Its positive characteristics may outweigh its negatives for investors considering a position.