Roth Capital’s Bill Kirk points out convenience issues behind Costco’s disappointing year
December 22, 2025 • 4m 27s
Sara Eisen (Co-anchor of Squawk on the Street)
00:00.190
joining
us
now
bill
kirk
senior
research
analyst
at
roth
capital
partners
bill
it's
great
to
have
you
on
and
let's
start
right
there
because
we're
not
talking
about
good
old
fashioned
foot
traffic
at
the
mall
on
the
weekends
you're
talking
about
app
downloads
how
meaningful
is
Sara Eisen (Co-anchor of Squawk on the Street)
00:11.990
this
data
and
why
well
Bill Kirk (Senior Research Analyst)
00:14.190
thanks
for
having
me
i
think
some
some
of
what
you
see
is
the
old
fashioned
stuff
it
is
the
the
companies
and
the
retailers
that
have
the
best
convenience
that
are
getting
the
downloads
and
yes
it
might
not
be
you
know
a
willingness
to
wait
for
delivery
times
but
you
can
use
the
Bill Kirk (Senior Research Analyst)
00:30.750
app
for
in
store
pickup
so
if
you're
a
last
minute
shopper
and
you
want
to
make
sure
you
get
the
product
a
really
good
way
is
to
use
the
walmart
app
use
the
target
app
select
in
store
pickup
and
that
way
you
don't
have
to
risk
the
delivery
times
at
this
point
so
last
minute
Bill Kirk (Senior Research Analyst)
00:45.390
shoppers
are
flocking
to
the
app
some
of
it
is
probably
for
in
store
pickup
and
your
point
walmart
still
very
very
strong
walmart
has
been
strong
for
a
while
it
was
very
strong
last
year
as
well
but
target
is
really
the
one
that's
picked
up
in
the
last
few
weeks
it's
done
much
Bill Kirk (Senior Research Analyst)
00:59.590
better
in
kind
of
the
the
shoppers
minds
or
you
know
in
their
consideration
set
from
black
friday
on
and
it's
it's
reached
the
number
three
spot
in
total
app
downloads
a
spot
it
hasn't
held
at
all
this
year
so
very
timely
to
be
in
in
customers
minds
Sara Eisen (Co-anchor of Squawk on the Street)
01:16.230
yeah
target
's
had
a
rough
year
it's
had
a
rough
arguably
a
rough
couple
of
years
here
you've
got
a
neutral
rating
does
this
change
your
thesis
on
target
Bill Kirk (Senior Research Analyst)
01:23.870
so
the
the
target
call
here
would
be
tactical
it
would
be
they
might
be
having
a
nice
holiday
season
they
started
with
commentary
in
three
Q
so
back
in
november
they
gave
commentary
that
their
toys
were
up
about
ten
percent
that
is
a
very
good
way
to
start
the
holiday
season
and
Bill Kirk (Senior Research Analyst)
01:40.710
the
app
downloads
have
been
strong
since
our
issue
with
target
is
a
bit
more
structural
and
a
bit
longer
term
we
think
they're
behind
on
investment
spending
their
their
price
points
are
a
little
too
high
for
some
of
their
assortment
as
well
so
we
think
calendar
twenty
twenty
six
Bill Kirk (Senior Research Analyst)
01:56.230
after
what
could
be
a
strong
holiday
season
you're
going
to
have
increased
spending
needs
for
target
which
is
earnings
risk
for
target
Michael Santoli (Senior Markets Commentator)
02:03.710
and
bill
now
i
know
you've
been
negative
at
least
as
of
recently
on
costco
they
don't
really
show
up
that
well
in
these
app
download
numbers
that
you
mentioned
and
it's
always
been
an
expensive
stock
but
what
do
you
say
to
folks
who
who
argue
that
you
know
it's
kind
of
unwound
Michael Santoli (Senior Markets Commentator)
02:18.110
that
really
huge
ramp
in
its
valuation
that
we
had
you
know
last
year
and
into
this
year
and
it's
kind
of
trading
back
to
where
it
always
has
and
it's
generally
been
you
know
sort
of
reliable
even
in
a
a
value
centric
consumer
environment
Bill Kirk (Senior Research Analyst)
02:32.750
it's
a
fair
place
to
start
and
that's
that's
kind
of
where
we
started
it
doesn't
underperform
too
many
consecutive
years
right
that's
very
rare
for
costco
to
underperform
two
years
in
a
row
and
that's
what
it
would
take
for
our
our
call
to
be
right
here
but
what's
happening
at
Bill Kirk (Senior Research Analyst)
02:45.870
costco
is
is
a
lot
of
metrics
are
going
the
wrong
way
at
the
same
time
renewal
rates
have
faded
a
little
bit
incremental
members
members
added
aren't
as
robust
as
it's
been
and
traffic
is
slowed
and
when
i
think
about
what
what
costco
does
and
what
costco
does
very
well
is
Bill Kirk (Senior Research Analyst)
03:00.910
they're
they're
better
than
every
other
retailer
offering
value
the
parameters
that
consumers
care
about
value
is
one
of
them
it's
convenience
plus
value
walmart
's
doing
both
walmart
does
both
very
well
costco
does
one
of
the
two
parameters
very
well
and
that's
been
perfect
Bill Kirk (Senior Research Analyst)
03:17.150
during
times
of
high
food
inflation
being
the
best
value
oriented
retailer
that
one
for
costco
but
now
with
food
inflation
at
lower
levels
and
it's
been
at
lower
levels
for
a
little
bit
people
or
at
least
incrementally
shift
a
little
bit
away
from
value
and
a
little
bit
toward
Bill Kirk (Senior Research Analyst)
03:33.390
convenience
and
that's
i
think
the
structural
problem
at
costco
is
they're
only
offering
one
of
the
two
parameters
and
the
convenience
part
which
they
don't
do
as
well
is
becoming
more
important
is
Michael Santoli (Senior Markets Commentator)
03:44.550
is
some
of
the
the
weakness
in
costco
is
it
picking
up
small
business
activity
to
some
degree
i
know
that
is
a
piece
of
their
of
their
consumer
side
it
Bill Kirk (Senior Research Analyst)
03:55.630
is
i
mean
they
they
do
a
very
good
job
they
have
they
have
great
assortment
they
have
unique
assortment
they
can
kind
of
hit
a
lot
of
different
consumers
but
as
things
like
walmart
dot
com
become
more
pervasive
with
third
party
sellers
right
walmart
dot
com
all
of
a
sudden
can
Bill Kirk (Senior Research Analyst)
04:11.630
have
a
endless
aisle
right
endless
assortment
assortment
that
can
overlap
with
costco
better
than
the
walmart
physical
stores
could
for
generations
so
you're
getting
increased
assortment
overlap
between
walmart
using
walmart
dot
com
and
what
costco
can
offer
Autoscroll