Wolfe Research Flags Tax Refund Tailwinds as a Positive for Costco Wholesale (COST)

Costco Wholesale Corporation (NASDAQ:COST) is one of the best stocks to buy and hold for 20 years.

Ahead of the 2026 tax filing season, expectations are rising that U.S. consumer spending will receive a boost, potentially impacting value-oriented retailers like Costco Wholesale Corporation (NASDAQ:COST).

On January 18, 2026, Wolfe Research laid out its expectations for material tailwinds to tax refunds in 2026, projecting an incremental $75 billion in refunds for households earning under $200,000, roughly $500 per filer. These expectations rose after the IRS left withholding tables unchanged following the mid-2025 One Big Beautiful Bill (OBBB). Furthermore, the investment firm projects an additional $20 billion in refunds for $200,000-$500,000 earners, driven by additional SALT-related benefits, with payouts typically accelerating after February 15. Costco Wholesale Corporation (NASDAQ:COST) is included in Wolfe Research’s Tax Refund Basket and is well-positioned to benefit from higher discretionary spending associated with refund inflows.

Meanwhile, three days earlier, Costco Wholesale Corporation (NASDAQ:COST) declared a $1.30 per share quarterly cash dividend, payable on February 13. This was preceded by Deutsche Bank’s initiation of coverage of the stock on January 8, 2026, when the firm set a ‘Buy’ rating and a $1,044 price target. While citing short-term pressures from food disinflation, the firm expected stimulus-driven tailwinds in the first half of 2026.

Costco Wholesale Corporation (NASDAQ:COST) focuses on operating membership-based warehouse clubs across the U.S., Canada, and international markets. It offers bulk merchandise at low prices with a high-renewal, fee-driven business model.

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