Costco Gross Margin Pressure From Higher Fuel Costs Likely to be Offset by Tariff Refunds, RBC Says

09:05 AM EDT, 09/15/2026 (MT Newswires) -- Costco Wholesale (COST) likely faced core gross-margin pressure in its fiscal fourth quarter from higher fuel and transportation costs, though tariff-related refunds are expected to partially offset that impact, RBC Capital Markets said in a Tuesday client note. The brokerage estimates the warehouse chain's fourth-quarter gross margin to be flat at 11.1% on a yearly basis, in line with consensus, reflecting "some softness" at the core mainly due to gas inflation and higher transportation costs. However, RBC expects a modest last-in, first-out, or LIFO, inventory-accounting tailwind and tariff-related refunds to offset the gross-margin pressure. Costco is scheduled to release its latest financial results next week. "We aren't expecting sentiment to change much on the print," RBC said. Oil prices have jumped more than 20% so far this month after notching gains in both August and July. In the US, the average diesel price reached $6.2694 per gallon on Tuesday, up from $5.4396 a month earlier, according to AAA motor club data. The regular gasoline price rose to $4.3289 per gallon from $4.0704 the month before. Costco's management has said they aim to pass on the benefits of the refunds to its members, but this will depend on the timing of the reimbursements, among other factors, RBC analyst Steven Shemesh wrote in the note. Earlier this year, the US Supreme Court ruled that the Trump administration lacked authority under the International Emergency Economic Powers Act to impose certain tariffs, paving the way for refunds to companies that had paid the duties. For the fourth quarter, RBC projects Costco to report adjusted earnings of $6.54 per share on revenue growth of 11%, down from its prior estimates of $6.57 and a revenue gain of 12%. The current consensus on FactSet is for the warehouse chain to record non-GAAP EPS of $6.55 and sales growth of 10% for the quarter. RBC has a sector perform rating on Costco's stock with a price target of $1,000.