Costco Wholesale (COST -0.10%) is a fan favorite among many shoppers looking for great deals. Investors love the company, too, thanks to its rising sales, expanding earnings, and growth from its e-commerce business.

All this has contributed to Costco's share price rising 180% over the past five years -- easily outpacing the S&P 500's return of 99%. While some investors were disappointed with the company's latest quarter, I think they're missing the bigger picture for the company's long-term potential.

Here are three reasons the stock is still a great buy.

1. Costco's growth is still impressive

Some investors sold their Costco shares after the company released its results from Q4, which ended August 31, because the company missed analysts' same-store-sales estimates. I think that reaction was a bit overblown, considering that same-store sales were still up 6.5% from the year-ago quarter and especially since Costco's overall metrics were very impressive.

Here's a quick summary of some of Costco's solid Q4 results:

  • Revenue of $86.16 billion, up 8% and ahead of Wall Street's consensus estimate of $86.06 billion.
  • Earnings per share (EPS) of $5.87, an increase of 11%, beating analysts' consensus estimate of $5.80.
  • Membership income rose 14% to $1.7 billion.

Costco navigated a potentially difficult quarter as it managed tariffs by offering new items from its Kirkland Signature private-label brand. It also grew its top and bottom lines, along with an impressive spike in membership income. With growth like this amid an uncertain time for retailers, the company showed it can weather difficult macroeconomic conditions and still come out ahead.

2. Both e-commerce and physical stores continue expanding

Some retailers struggle to find the right balance between expanding their e-commerce businesses and opening new stores -- but not Costco. The company's online sales continue to march higher at the same time that it expands its store footprint.

E-commerce sales rose by 13.5% in the quarter and now account for about 7% of total sales, and traffic to the company's website jumped 27% in the fourth quarter. On an annual basis, its online sales are even more impressive, rising 15% in fiscal 2025 to $19.6 billion. Part of the increase is likely due to Costco offering more products online, improving search features, and even launching an online waiting room for high-interest items.

In addition to its expanding online presence, Costco continues to open new stores including 24 this year, bringing the total to 914 worldwide. A total of nine stores were opened in the fourth quarter alone, and Costco plans to add 30 additional stores in 2026. More stores mean the potential for more members to shop at Costco, which could help drive membership income even higher.

3. Younger shoppers, higher earners, and high renewal rates

Costco had made some important gains in expanding its appeal to younger shoppers. Earlier this year, its management highlighted the fact that each year, about half of the customers who sign up for new memberships are under age 40.

That's important for the company because people in that age category may have more disposable income to spend than older shoppers. What's more, the average Costco customer has an average annual household income of about $125,000, which gives the company a solid base of customers who may be able to continue their spending in uncertain economic times. This is all the more important as recent jobs data shows the hiring market is slowing down.

Once younger people sign up for a Costco membership, they're likely to stick around. Costco has very high membership renewal rates of 93% (for its U.S. and Canadian customers), which means that today's new members are likely to remain tomorrow's customers.

With Costco's membership-income growth, rising sales and earnings, ability to attract new customers, and high renewal rates, there are a lot of reasons to buy the company's stock and hold onto this retail giant for years to come.