Filing Flows › Costco Wholesale (COST) › Takeover & LBO
Is Costco Wholesale (COST) a takeover target?
A leveraged buyout at today's price plus 30% ($1,386.19 a share) would return a loss of about 1% a year to a private-equity buyer over 5 years; no price, however low, gets a buyer to 20%. At $600.9B it would be larger than any buyout on record (the model flags anything over $60 billion), so this is a thought experiment more than a prospect. Historically 2.0% of companies with its figures were bought within a year (0.41× the average).
The buyout, step by step
| Entry | Amount | How |
|---|---|---|
| Offer price a share | $1,386.19 | today's $1,066.30 plus 30% |
| × shares | 444.4 million | |
| = Equity value | $616.1B | |
| + Debt refinanced | $6.2B | |
| − Cash | $21.3B | |
| = Enterprise value | $600.9B | 41.8× EBITDA of $14.4B |
| Fees | $12.0B | 2% of the price |
| New debt | $79.0B | 5.5× EBITDA at 7.65% a year; the limit that binds: 5.5× EBITDA |
| Buyer's own money | $534.0B | 87% of the cost |
5 years under the buyer
| Year | Revenue | EBITDA | Interest | Free cash flow | Debt left |
|---|---|---|---|---|---|
| Year 1 | $327.4B | $15.5B | $6.0B | −$1.5B | $80.5B |
| Year 2 | $349.5B | $16.6B | $6.2B | −$1.0B | $81.5B |
| Year 3 | $368.7B | $17.5B | $6.2B | −$492M | $82.0B |
| Year 4 | $384.4B | $18.2B | $6.3B | $95.8M | $81.9B |
| Year 5 | $395.9B | $18.8B | $6.3B | $707M | $81.2B |
The exit and the buyer's return
| Exit | Amount | |
|---|---|---|
| Exit multiple | 31.9× EBITDA | today's trading multiple, before any premium |
| Enterprise value at exit | $599.2B | |
| − Debt left | $81.2B | |
| = Buyer's equity | $517.9B | |
| Money multiple | 0.97× | on $534.0B put in |
| Buyer's yearly return (IRR) | −0.6% |
Price against return
What the buyer makes at other premiums over today's $1,066.30.
| Premium | Price a share | Buyer's IRR |
|---|---|---|
| 10% | $1,172.93 | 3.4% |
| 20% | $1,279.56 | 1.3% |
| 30% | $1,386.19 | −0.6% |
| 40% | $1,492.82 | −2.3% |
| 50% | $1,599.45 | −3.9% |
The figures used
| Figure | Amount | |
|---|---|---|
| Revenue, last 12 months | $303.2B | |
| EBITDA, last 12 months | $14.4B | 4.7% of revenue |
| Depreciation and amortization | $2.7B | |
| Capital spending | $6.4B | |
| Debt | $6.2B | |
| Cash | $21.3B | |
| Share price | $1,066.30 | on Nov 5, 2026 |
Fixed rules, the same as the interactive view's starting point: the shares are bought at today's price plus 30%, the company's debt is refinanced and fees take 2%. New debt is the least of 5.5× EBITDA, 65% of the price and the amount whose interest EBITDA covers 2 times, at 7.65% a year (SOFR 3.89% plus the high-yield B spread 3.26% plus 0.5%, rates of Oct 15, 2026). Revenue grows 8.0% in the first year — the company's own rate, held between −3% and +8% — fading to 3% by year 5; the EBITDA margin, depreciation and capital spending stay at today's share of revenue; working capital takes 10% of each year's added revenue; tax is 25% of profit after interest. Every dollar of free cash flow repays debt. After 5 years the buyer sells at today's multiple of EBITDA.
What a takeover could cost
Takeovers on record paid a median premium of 32.5% over the share price before the deal (the middle half 20% to 51.8%), according to the 1,437 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Costco Wholesale would cost about $1,412.85 a share, $627.9B for all its shares.
| Premium | % | Price a share | All shares |
|---|---|---|---|
| Low end (a quarter of deals paid less) | 20% | $1,279.56 | $568.7B |
| Median | 32.5% | $1,412.85 | $627.9B |
| High end (a quarter paid more) | 51.8% | $1,618.64 | $719.4B |
The odds, from history
Historically 2.0% of companies with its figures were bought within a year (0.41× the average). Its figures put it in decile 1 of 10 (10 = the most likely to be bought). The odds come from a model of every merger proxy, tender-offer response and going-private statement filed on EDGAR since 2011, set against each company's size, margins, debt, cash flow and growth the year before.
Costco Wholesale's latest quarter
Costco Wholesale, Q4 FY26: revenue $95.7B (+11% year over year), operating margin 4.0%, net earnings $3.0B. The chart follows the revenue to costs, profit and cash.
Questions
Is Costco Wholesale being acquired?
No headline, 8-K or 13D about a sale is on file in the last year.
Could private equity buy Costco Wholesale?
A leveraged buyout at today's price plus 30% ($1,386.19 a share) would return a loss of about 1% a year to a private-equity buyer over 5 years; no price, however low, gets a buyer to 20%. At $600.9B it would be larger than any buyout on record (the model flags anything over $60 billion), so this is a thought experiment more than a prospect.
What would a takeover of Costco Wholesale cost?
Takeovers on record paid a median premium of 32.5% over the share price before the deal (the middle half 20% to 51.8%), according to the 1,437 merger proxies and tender-offer responses on EDGAR that state a premium. At the median, Costco Wholesale would cost about $1,412.85 a share, $627.9B for all its shares.
Updated Nov 8, 2026. Read automatically from SEC filings and public data; errors are possible. Not investment advice.