Costco Regains Its Mojo Amid Hopes for Tariff Relief and Special Dividend
AI Latest news — January 8, 2026
Costco Wholesale Corporation (COST) shares staged a powerful comeback in Thursday morning trading, rallying nearly 5% as investors digested a stellar December sales report. The retail powerhouse, often viewed as a bellwether for consumer health, is back in the spotlight not just for its sales numbers, but as the centerpiece of a multi-billion-dollar legal battle at the U.S. Supreme Court that could trigger a massive cash windfall and a long-awaited special dividend.
For a stock that faced rare underperformance throughout 2025, today’s move signals that the “Costco Mojo” has officially returned.
December Sales Surge: Proving the Membership Model’s Durability
Late Wednesday, Costco reported net sales of $29.86 billion for the five-week retail month ended January 4, 2026. This represents an 8.5% increase from the $27.52 billion reported during the same period last year.
Jefferies analyst Corey Tarlowe noted that the firm views these monthly results as a resounding endorsement of the “durability” of Costco’s membership model. “Costco continues to gain market share in a mixed consumer environment,” Tarlowe wrote, while pushing the firm’s FQ2 comparable sales and EPS estimates higher.
Key Sales Metrics:
- Total Comparable Sales: Up 6.4% across the global network.
- E-commerce Momentum: Digital sales saw a significant boost, growing by 20.5%.
- Customer Loyalty: Membership fees increased by 14%, with renewal rates holding steady at a industry-leading 92.2% in the U.S. and Canada.
The $90 Billion Catalyst: The Supreme Court and Tariff Relief
The most explosive narrative surrounding Costco in 2026 isn’t just what’s happening on the shelves, but what’s happening in the courtroom. Costco recently filed a separate, high-stakes lawsuit in the U.S. Court of International Trade to preserve its right to a “full refund” of tariffs paid under President Trump’s International Emergency Economic Powers Act (IEEPA).
The U.S. government has collected nearly $195 billion in customs duties in Fiscal Year 2025, with internal filings suggesting Costco has already paid roughly $90 billion in tariff-related charges.
“Costco’s lawsuit could become the blueprint for massive corporate refunds. If the Supreme Court rules these emergency tariffs are unlawful, the Treasury could be liable for well over $100 billion in repayments to importers.”
The Supreme Court is expected to issue a ruling as early as this Friday, January 9. Prediction markets currently suggest a 75% probability that the court will strike down or significantly limit the President’s authority to impose these duties without Congressional approval.
The Special Dividend and Stock Split Speculation
With Costco’s cash balance at the end of Q1 2026 exceeding $16.2 billion—and a potential multi-billion-dollar tariff refund on the horizon—analysts are ramping up talk of a special dividend.
Oppenheimer analyst Rupesh Parikh reiterated his Outperform rating today, highlighting that a “special dividend or a stock split” remains a primary positive catalyst for the shares. Historically, Costco rewards patient shareholders with one-time payouts every few years (the last being a $15-per-share dividend in December 2023).
Frequently Asked Questions (FAQs)
Q: Why is Costco’s stock rally so significant today? A: The rally follows a December sales report that beat expectations (up 8.5%) and anticipates a Supreme Court ruling on tariffs that could refund billions to the company.
Q: How much money could Costco get back if the tariffs are ruled illegal? A: While the exact amount in the lawsuit isn’t disclosed, reports indicate Costco has paid approximately $90 billion in IEEPA-related tariffs. A refund of even a fraction of this would be a massive boost to earnings.
Q: Is a special dividend guaranteed in 2026? A: It is not guaranteed, but Costco’s rising cash position (up 15% year-over-year) and the history of payouts suggest it is a high-probability event if the legal ruling is favorable.
Q: What is the current analyst sentiment on COST stock? A: Sentiment is overwhelmingly positive. Out of 30 analysts, 60% carry a “Buy” or “Outperform” rating, with price targets ranging as high as $1,218.
