Most Costco Members Don't Shop at Costco All That Much
Costco (NASDAQ: COST) markets itself as a warehouse club where, in exchange for a membership fee, consumers get access to a variety of food, merchandise, and services at discounted prices.
Of course, the company does offer those things, but that's not really the chain's business model. In many ways, Costco operates like a gym. It sells memberships knowing that many of its members won't show up. It's not upset if they do -- and it takes care of its members who spend the most -- but in reality. it only needs customers to see the value of joining, not actually have them do any shopping.
Costco makes money whether its members shop or not. Image source: Costco.
Source: Fool.com
Costco Wholesale Stock
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As a result the target price of 804 € shows a slightly positive potential of 8.18% compared to the current price of 743.2 € for Costco Wholesale.
