Company Overview - Costco Wholesale is projected to achieve $270 billion in net sales for fiscal 2025, positioning it as a leading player in the general merchandise retail sector [1] - Home Depot's share price has increased by 41% over the past five years, contrasting with Costco's total return of 199% during the same period [1] Performance Analysis - Costco consistently reports same-store sales growth, including a 7.7% increase during fiscal 2020 despite the COVID-19 pandemic, indicating stable demand regardless of macroeconomic conditions [2] - Home Depot experienced double-digit revenue growth during the pandemic years but has faced a decline in demand in recent years, with only a 0.2% increase in same-store sales in the third quarter of fiscal 2025 [6][7] Business Model and Strategy - Costco's value proposition lies in offering high-quality goods at low prices, supported by its large scale which allows for favorable procurement costs, fostering customer loyalty [3] - The membership model is crucial for Costco, with a 5.2% year-over-year increase in membership base to 81.4 million and a renewal rate of 89.7%, providing a recurring and high-margin revenue stream [4] Growth Potential - Costco operates 921 warehouses and aims to open 30 new locations annually, indicating significant growth opportunities both domestically and internationally [5] - The company's net income has grown at a compound annual rate of 11.4% over the past five years, which supports regular payouts and special dividends [5]

Core Insights - Ken Fisher's investment firm, Fisher Investments, manages over $362 billion in assets and focuses on resilient consumer stocks for long-term growth [1] - The consumer staples sector has underperformed the broader market due to high interest rates and inflation, with the S&P 500 Consumer Staples Index returning approximately 2.6% this year compared to over 12.5% for the S&P 500 Index [2] - The consumer discretionary sector has shown more volatility but outperformed the S&P 500 Index over the past year with a return of around 17.0% [2] - Recent mixed market sentiments are influenced by strong corporate earnings and rising U.S.-China trade tensions, with gold prices rising past $4,200 per ounce [3] Consumer Staples Sector - Companies in the consumer staples sector are known for resilience, consistent cash flows, and pricing power, but have faced challenges due to inflation and high interest rates [2] - The sector has underperformed over the last 1, 3, and 5 years, leading to cautious outlooks from analysts [2] Consumer Discretionary Sector - The consumer discretionary sector has shown better long-term performance despite recent underperformance year-to-date, indicating potential for recovery [2] - The sector's volatility may present opportunities for high-quality consumer stocks as trade uncertainties ease [3] Ken Fisher's Stock Picks - The list of Ken Fisher's top 10 consumer stock picks is based on strong brand equity, pricing power, and consistent demand resilience [7] - The performance of these stocks from the end of Q2 2025 to October 15 has been tracked to provide insights into their potential upside [8] Individual Stock Analysis - **Target Corporation (NYSE:TGT)**: - Upside potential of 11.67% with a share price return of -12.46% from July 1 to October 15 [10] - Operational challenges have affected brand image and consumer engagement, necessitating significant investment to address these issues [11][12] - **Colgate-Palmolive Company (NYSE:CL)**: - Upside potential of 16.89% with a share price return of -15.66% [14] - Analysts have reduced price targets due to short-term pressures, but the company's diversified portfolio supports long-term growth [15][16] - **Starbucks Corporation (NASDAQ:SBUX)**: - Upside potential of 16.91% with a share price return of -12.71% [17] - The company has approved a dividend increase and is undergoing a restructuring plan to enhance operational efficiency despite recent cost pressures [18][19]