Thanksgiving is Nov. 26 this year, with Black Friday the day after.
For the largest retailers, the weeks that follow can do more for the year’s results than any other stretch. Last year, Amazon (NASDAQ:AMZN) reported fourth-quarter sales around 18% higher than its third-quarter sales.
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Two retail stocks look worth owning before the rush to me: Amazon and Costco Wholesale (NASDAQ:COST). Both are going into the season with sales growth that has held up well this year.
But their stocks have gone different ways lately. Amazon shares are still well below the record they hit in early August. Costco shares, meanwhile, have risen around 8% so far in October to near $1,000 as I write.
Image source: Amazon.
1. Amazon’s biggest quarter is coming
Amazon’s fourth quarter is reliably its biggest. In the holiday period of 2025, net sales hit $213.4 billion, 14% higher than a year before and far above the third quarter’s $180.2 billion.
The profits show up in the retail business, too. Operating income for Amazon’s North America segment, which has most of its store sales, rose around 24% year over year to $11.5 billion in last year’s fourth quarter. That was far above the third quarter’s $7.3 billion (a number that leaves out a $2.5 billion legal settlement with the Federal Trade Commission).
And this year, Amazon’s sales have risen even faster. Revenue growth picked up from 14% in last year’s fourth quarter to 17% in this year’s first quarter, then 20% in the second, but Prime Day’s move to June lifted that final number.
Of course, the same shift holds back the third quarter. Management’s outlook calls for growth of 9% to 12%, or about 13% to 16% with Prime Day left out in both years. The third-quarter report, probably due later this month, should also have management’s first forecast for the holiday quarter.
Even after a rise of about 2% in October, the stock trades near $254, about 11% below the $284.02 record close it set Aug. 3.
Based on analysts’ 2027 earnings estimates, shares cost about 24 times earnings. This looks like a fair price to me for a company going into its biggest quarter with double-digit sales growth.
2. Costco is entering the holidays growing faster
The warehouse club’s fiscal first quarter spans 12 weeks ending right before Thanksgiving, so Black Friday and December fall in Costco’s fiscal second quarter. This makes its monthly sales reports the first public look at how the season goes.
