Comparable Sales: What the Adjusted Number Takes Out

Comparable sales are the measure that tells you whether a shop is getting better at being a shop, as distinct from simply becoming a larger company. The catch is that the figure comes in more than one version, and the versions can be several points apart in the same announcement. Costco's fourth quarter of fiscal 2026 printed 9.4 per cent on one line and 6.7 per cent on another, in a single table in its results release. Knowing which of those to read is most of the skill.

What the Measure Excludes, and Why

Total revenue growth answers two questions at once and separates neither. A chain can sell more because each location is doing better, or because it built more locations. Only the first says the business improved. The second says it got bigger, which costs capital and tells you nothing about whether shoppers like the place.

So the comp counts only locations trading in both periods, usually those open at least a year, and compares like with like. Everything opened since is set aside until it has been around long enough to have a prior-year figure of its own. The formula is ordinary arithmetic. The definitions around it are where the work is.

Three Engines Behind a Rising Comp

• Footfall. More people walk in than walked in last year. This is the strongest of the three, because it is the hardest to manufacture.

• Basket size. The same shoppers put more in the trolley, through either volume or a shift toward dearer items.

• Price. The identical goods simply cost more, which lifts the sales figure even when volumes are flat or falling.

A comp built mostly on the third engine is the weak kind, because it can coexist with customers buying less and visiting less often. A comp built on the first is the one worth paying for, and the better releases tell you which it was.

What a Falling Comp Usually Means

A negative figure says the existing estate sold less than it did a year earlier. Fewer visits, smaller baskets or a competitor taking share are the usual causes, and management will often reach for weather or a shifted trading calendar instead. Those explanations are sometimes true and almost always short-lived. Where the negative figure persists across several quarters, the calendar has stopped being a plausible defendant.

Costco's Two Numbers, Side by Side

For the sixteen weeks to 30 August 2026, Costco reported total comparable sales of 9.4 per cent, adjusted to 6.7 per cent, with the United States at 10.7 and 7.2, Canada at 5.0 and 4.6, other international at 7.0 and 6.2, and a digitally enabled figure of 19.5 per cent rising to 19.8 per cent on the adjusted basis. Across the full fifty-two weeks the totals were 8.4 per cent and 6.6 per cent, all in the company's own table.

The adjustment removes two things the company does not control: movements in the price of petrol, and movements in exchange rates. A higher pump price raises fuel sales without a single extra motorist arriving. A softer dollar converts the same Canadian trolley into more dollars. The company footnotes the adjustment as excluding exactly those two effects, immediately beneath the same table.

Notice where the gap is widest. The United States shows 10.7 against 7.2, which is where fuel pricing did the most lifting, on those reported figures. That fuel business is not a distraction, since it pulls members into the car park and onward through the door, and the chief executive described a record year for it driven by members looking for value, as MarketBeat reported from the results. It is simply a different species of growth from a larger basket of goods inside.

Target Defines It Differently, and That Settles the Comparison

Two retailers publishing the same metric are not necessarily publishing the same thing. Target's own comparable sales document sets out its rule: all merchandise sales except those from stores open less than thirteen months, digital acquisitions owned less than thirteen months, closed stores, and digital acquisitions it no longer runs, measured against the equivalent prior-year period, in the footnote to its published series.

Thirteen months rather than twelve. No fuel adjustment, because fuel is not the business. An explicit carve-out for acquired digital operations, which Costco's definition has no reason to mention. Set those two definitions beside each other and the idea that you can rank two retailers on a comp alone falls apart before you reach the numbers.

Four Ways to Put a Comp to Work

Find both versions first. The reported figure and the adjusted figure both belong in your notes, and where a company publishes only one, that choice is worth a moment's thought on its own.

Then line up the series rather than the quarter. Target publishes its quarterly comps back to fiscal 2022 in one document, which makes the exercise trivial for that company, straight from its own series. Most retailers make you assemble it from successive releases, and assembling it is still the right move.

Third, set comps against total growth and ask what filled the gap. Costco's net sales rose 10.1 per cent for the fiscal year while adjusted comps rose 6.6 per cent, on the company's reported figures, and the remainder came from new warehouses, currency and fuel. The company ended the year operating 939 warehouses, 647 of them in the United States and Puerto Rico, as the release states, so new openings will keep contributing to the total whatever the comp does.

Fourth, put the comp next to the margin. Rising comps with a thinning margin can mean a retailer is purchasing its growth through price, which is the other half of the picture covered in our piece on what an operating margin actually shows. The order to run these checks in is set out in our half-hour routine for a retailer.

Where the Number Gets Misused

Start with the correction: a large comp is not automatically good news. Where most of it came from fuel pricing and currency, it says very little about whether shoppers wanted more.

Ranking retailers against each other without reading both definitions is the second error, and the Costco and Target rules above show why. One counts from twelve months, the other from thirteen, and only one adjusts for fuel.

Treating the comp as a profit measure is the third. A location can grow its sales and lose money on every item it sells. The comp is a demand measure wearing a financial costume.

The fourth is reading the digital line as though it were the whole business. A digitally enabled figure near twenty per cent sits beside a total near seven, on Costco's reported quarter, and the two describe different channels at very different scales.

Eight Quarters or Nothing

Here is the position: a single quarter's comparable sales figure is close to uninformative, and the habit of reporting it as news is the main reason readers misunderstand retailers.

The reason is in the construction. A comp is a ratio against the same period a year earlier, which makes it a statement about two periods, not one. A weak base produces a flattering figure from an unremarkable quarter, and a strong base produces a worrying figure from a perfectly decent one. Target's own published series shows this doing real work: comps fell through every quarter of fiscal 2023 and finished that year at minus 3.7 per cent, recovered to roughly flat across fiscal 2024, fell again to minus 2.6 per cent for fiscal 2025, and then opened fiscal 2026 at 5.6 per cent and 3.8 per cent, on the company's own table. Read the most recent figure alone and you see a business accelerating. Read the column and you see a business climbing out of a hole it spent three years digging, which is a different sentence entirely.

Take a retailer that has stopped expanding and whose prior-year base is stable: it gives a cleaner single reading, because there is less for the comparison to hide behind. The same applies where the release breaks the comp into traffic and basket, since footfall is harder to flatter than price. Absent either, treat one quarter as a data point and nothing more, and treat the forecasts built on it with the same caution set out in our piece on reading analyst estimates for a retailer.

A Comp Answers One Question Only

It tells you whether the shops a company already had sold more than they did a year ago. Read the adjusted version first, put it in a column with the seven quarters before it, and check which engine was driving. Anything else you want to know about the business lives somewhere else in the release.

This article is for educational and informational purposes only. It is not financial advice, and Investor Muse is not a registered investment advisor. Historical figures describe the past and do not predict future results. Speak with a qualified professional before you make decisions about your money.

Position disclosure: neither Investor Muse nor its editorial team holds a position in any company, fund or security named in this article.