Costco Wholesale (NASDAQ: COST) has been a top retail stock for years with high membership renewal rates despite inflation. Recent strong earnings beat expectations, but the stock is down 6% this year. The stock may continue to fall in 2026 due to its high valuation. Costco’s stock is trading at a price-to-earnings multiple of 46, making it potentially overpriced. Without significant growth opportunities, it could be a rough year for Costco stock. Consider long-term investment but brace for short-term declines. The Motley Fool did not include Costco in its top 10 stock picks.

Read more at Nasdaq: Costco Beat Earnings Expectations in Q1. Here’s Why It Could Still Struggle in 2026.