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Uk1 Green Flag for Costco Wholesale Right Now
Price-sensitive shoppers are more likely to choose Costco over Walmart and Target if tariffs fuel inflation.
This thesis is a relative edge, not a super-positive windfall.
NASDAQ: COST
Costco Wholesale
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Price as of August 18, 2025, 3:58 p.m. ET
What’s the green flag for Costco investors right now? The answer might surprise you.
Stiff and unpredictable tariffs aren’t exactly good news for retail giant Costco Wholesale (COST 0.75% ) , but they could actually help the company in a relative way. Here’s why I would call the spiking tariffs a green flag for Costco and its shareholders.
Tariffs aren’t great for Costco, but even worse for its rivals
I don’t think you’ll see Costco’s management tout the tariffs as helpful any time soon. The company’s focus on selling high-quality goods at a low price is strictly opposed to rising and unstable item prices. Indeed, management spent a lot of time on the last earnings call discussing Costco’s tariff mitigation efforts, but never even suggested that the trade tensions could be a net positive catalyst for the company.
At the same time, I see several ways this global trade environment might work to Costco’s benefit. You see, this particular type of pressure is best met by some of Costco’s strongest qualities:
- Its scale lets Costco push vendors to absorb more of the cost hit than smaller retailers.
- With fewer unique items on the store shelves, Costco can reprice and pivot sourcing faster than most.
- Price-sensitive shoppers will probably choose Costco more often if the recently activated tariffs result in costly inflation.
- The company’s profit margins were always slim, but supported by the lucrative and ultra-predictable membership fees.
- Imagine shoppers visiting Costco (or its online store) just to compare prices against Walmart (WMT 0.68% ) and Target (TGT 1.97% ) . These curious peeks could very well inspire more membership sales.
- The popular Kirkland Signature store brand can dodge tariff effects by selecting local production partners or other lower-tariff sources more often.
Image source: Getty Images.
A relative edge for Costco investors
So tariffs will add to Costco’s expenses and make its operations less predictable for a while. But the same effects will apply to every rival, and often to a greater and more painful degree.
It’s not a classic competitive advantage, but I see the current tariff trend as a green flag for owning Costco stock in 2025.
About the Author
Anders Bylund has positions in Walmart. The Motley Fool has positions in and recommends Costco Wholesale, Target, and Walmart. The Motley Fool has a disclosure policy.
Costco to not sell abortion pill mifepristone at its US pharmacy stores
[1/2] A patient prepares to take Mifepristone, the first medication in a medical abortion, at a cinic in Carbondale, Illinois, U.S., April 20, 2023. REUTERS/Evelyn Hockstein/File Photo Purchase Licensing Rights
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Aug 14 (Reuters) – (This Aug. 14 story has been corrected to say that Costco will ‘not sell’ mifepristone instead of ‘stop selling’ the pill in paragraph 1 and removes reference to ‘stopping sale’ in paragraph 2)
Costco Wholesale (COST.O)
, opens new tab said on Thursday it has decided to not sell abortion pill mifepristone across all its U.S. pharmacy stores, citing low demand.
“Our position at this time not to sell mifepristone, which has not changed, is based on the lack of demand from our members and other patients, who we understand generally have the drug dispensed by their medical providers,” Costco said.
The decision comes amid campaigns against the pill by religious activist groups, including Inspire Investing and Alliance Defending Freedom.
“Many retailers have become more cautious about taking overt political or social stances after recent controversies triggered boycotts, negative media coverage, and polarized consumer reactions,” said Arun Sundaram, senior analyst at CFRA.
Bloomberg reported earlier in the day that religious activist groups, which targeted retailers including Costco, Kroger (KR.N)
, opens new tab last year, will now focus on Walgreens (WBA.O)
, opens new tab that dispense the pill in states where abortion is legal.
“The U.S. Supreme Court’s ruling on mifepristone access allows Walgreens to continue to dispense mifepristone under the FDA guidelines,” Walgreens’ website states.
Kroger said it was reviewing the FDA’s updated mifepristone Risk Evaluation and Mitigation Strategy (REMS) drug safety program, while CVS told Reuters that it fills “prescriptions for mifepristone in select states where legally permissible.”
Mifepristone was approved in combination with misoprostol in 2000 by the U.S. Food and Drug Administration to end a pregnancy within 10 weeks of gestation.
Mifepristone blocks progesterone, the hormone that helps a woman’s body maintain the lining of the uterus during pregnancy. Misoprostol is then taken to complete the abortion process.
Reporting by Neil J Kanatt and Sriparna Roy in Bengaluru; Editing by Shilpi Majumdar and Shinjini Ganguli
In Conversation with Gino Dorico, SVP and Country Manager, Costco Wholesale Canada
RCC’s In Conversation with Retail Leaders in Canada is an exciting series featuring in-depth conversations with Canada’s top retail leaders and industry insiders.
Senior Vice President & Country Manager, Costco Wholesale Canada
Date: Tuesday, September 16, 2025
Time: 7:30am – 9:15am ET
Agenda:
- 7:30am – 8:15am Registration, Networking & Hot Breakfast
- 8:15am – 9:15am In Conversation and Audience Q&A
Location: Toronto Airport Marriott Hotel, 901 Dixon Road, Toronto, ON M9W 1J5
Who should attend?
In Conversation with Retail Leaders in Canada is a networking breakfast exclusively for suppliers and vendors.
Single Event Tickets:
- RCC & FHCP Members Individual Pass $229.99 | Table of 8 $1,599.99
- Non-Members Individual Pass $349.99 | Table of 8 $2,449.99
Not sure if your company is a member? Please contact [email protected]
Gino has been with Costco for 37 years. Since 2022, he is the Senior Vice President and Canada Country Manager.
He is responsible for 110 locations across Canada, that include Operations, Buying, Business Center, Marketing and Ecommerce.
Outside of work, Gino has a passion for hockey and loves traveling with his wife, Angela, and their two daughters, Andrea and Claudia.
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