Costco Wholesale Corp. has introduced an unconventional retail approach in its Chinese operations by selling genuine Hermès Birkin and select Chanel handbags at prices markedly lower than typical market values. These luxury items are displayed in warehouse settings and offered at prices around $14,000, significantly below the usual pricing for such high-end brands. This move, first implemented with Costco’s entry into the Shanghai market in 2019, has since stimulated notable demand among China's wealthier customers, spreading rapidly through social interest and online attention.
The prominent financial commentator Jim Cramer publicly expressed astonishment at Costco’s strategy, describing it as "just crazy" while simultaneously affirming his support for the stock overall. His remarks followed dissemination of reports highlighting the discounted sales of these luxury handbags at Chinese warehouse outlets. This unusual inventory approach contrasts with Costco's typical product assortment and pricing models elsewhere.
Turning to Costco's broader financial results, the retailer surpassed analyst forecasts in its first fiscal quarter of 2026. The company reported revenue totaling $67.31 billion, marginally exceeding the consensus estimate of $67.14 billion. Additionally, adjusted earnings per share reached $4.50, outperforming the expected $4.27 figure. These results underscore Costco’s robust operational execution amid diverse market challenges.
Earlier in the year, financial services firm Mizuho elevated its rating on Costco from Neutral to Outperform, accompanied by an increased price target of $1,000 per share, up from $950. This upgrade implies potential upside of approximately 17 percent. Mizuho’s analysis downplayed concerns regarding deceleration in membership growth and comparable sales metrics, highlighting that about half of recently opened U.S. warehouses are designed as "fill-ins" in strong markets. This strategy serves to alleviate traffic congestion without necessarily targeting fresh customer acquisition, suggesting sustained underlying consumer demand.
In alignment with these upbeat outlooks, Jim Cramer noted that Costco’s stock is beginning to present an attractive opportunity for investors once more. This view is supported by data from Bank of America, indicating an unprecedented influx of capital into consumer staples stocks in recent weeks. This trend reflects a broader investor shift away from technology-dominated portfolios in favor of more defensive sectors amid growing uncertainty impacting growth-focused industries.
Benzinga Edge Stock Rankings assign Costco a quality score of 95.92 percent and a value rating of 35.22 percent, indicating strong operational and financial attributes but moderate valuation appeal. The platform’s screening tools allow investors to benchmark Costco’s performance relative to peers across key metrics. Price movements over the past year show a 4.26 percent decline in Costco shares, despite a marginal gain of 0.04 percent to close at $978.35 recently.
The juxtaposition of Costco’s innovative luxury product strategy in China with its solid financial and market fundamentals in the broader retail landscape presents an intriguing snapshot of the company’s multifaceted growth initiatives. The discounted sale of high-end handbags in Chinese warehouses remains a point of contention and curiosity, while the company’s core business continues to demonstrate resilience and favorable sentiment among investors and analysts alike.
Stakeholders monitoring Costco will need to watch how these distinct elements evolve, particularly as the company balances its traditional warehouse club model with emerging consumer trends and regional market dynamics. The current trajectory indicates that Costco is leveraging both premium product offerings in select geographies and steady execution of its wider operational plans to sustain its competitive positioning going forward.
The prominent financial commentator Jim Cramer publicly expressed astonishment at Costco’s strategy, describing it as "just crazy" while simultaneously affirming his support for the stock overall. His remarks followed dissemination of reports highlighting the discounted sales of these luxury handbags at Chinese warehouse outlets. This unusual inventory approach contrasts with Costco's typical product assortment and pricing models elsewhere.
Turning to Costco's broader financial results, the retailer surpassed analyst forecasts in its first fiscal quarter of 2026. The company reported revenue totaling $67.31 billion, marginally exceeding the consensus estimate of $67.14 billion. Additionally, adjusted earnings per share reached $4.50, outperforming the expected $4.27 figure. These results underscore Costco’s robust operational execution amid diverse market challenges.
Earlier in the year, financial services firm Mizuho elevated its rating on Costco from Neutral to Outperform, accompanied by an increased price target of $1,000 per share, up from $950. This upgrade implies potential upside of approximately 17 percent. Mizuho’s analysis downplayed concerns regarding deceleration in membership growth and comparable sales metrics, highlighting that about half of recently opened U.S. warehouses are designed as "fill-ins" in strong markets. This strategy serves to alleviate traffic congestion without necessarily targeting fresh customer acquisition, suggesting sustained underlying consumer demand.
In alignment with these upbeat outlooks, Jim Cramer noted that Costco’s stock is beginning to present an attractive opportunity for investors once more. This view is supported by data from Bank of America, indicating an unprecedented influx of capital into consumer staples stocks in recent weeks. This trend reflects a broader investor shift away from technology-dominated portfolios in favor of more defensive sectors amid growing uncertainty impacting growth-focused industries.
Benzinga Edge Stock Rankings assign Costco a quality score of 95.92 percent and a value rating of 35.22 percent, indicating strong operational and financial attributes but moderate valuation appeal. The platform’s screening tools allow investors to benchmark Costco’s performance relative to peers across key metrics. Price movements over the past year show a 4.26 percent decline in Costco shares, despite a marginal gain of 0.04 percent to close at $978.35 recently.
The juxtaposition of Costco’s innovative luxury product strategy in China with its solid financial and market fundamentals in the broader retail landscape presents an intriguing snapshot of the company’s multifaceted growth initiatives. The discounted sale of high-end handbags in Chinese warehouses remains a point of contention and curiosity, while the company’s core business continues to demonstrate resilience and favorable sentiment among investors and analysts alike.
Stakeholders monitoring Costco will need to watch how these distinct elements evolve, particularly as the company balances its traditional warehouse club model with emerging consumer trends and regional market dynamics. The current trajectory indicates that Costco is leveraging both premium product offerings in select geographies and steady execution of its wider operational plans to sustain its competitive positioning going forward.