Warren Buffett prizes durable brands, high returns on capital, and rising dividends. Costco Wholesale (NASDAQ:COST | COST Price Prediction), Fastenal (NASDAQ:FAST), and Visa (NYSE:V) all clear that bar, yet each trades on very different terms today. Here is how each stacks up on valuation, growth, and dividend quality right now.
Costco at $940.87: A Premium-Priced Compounder
Costco is the definition of a Buffett-style compounder, with a 89.7% worldwide renewal rate baked into Q3 FY2026 membership fees of $1.37 billion, up 10.7%. Comparable sales rose 9.8% and digital comps jumped 21.5%, and management is on track for roughly 940 warehouses by fiscal year end. The dividend has climbed from $1.02 in early 2024 to $1.47 today, with periodic specials layered on top.
The problem is price. Costco trades at 47 times trailing earnings and 41 times forward, with a 0.57% yield and a PEG of about 5. Shares are up 9.42% year to date but off 0.81% over the past year, roughly in line with the broader market. The $1,076.91 analyst target across 37 covering analysts implies mid-teens upside, but targets are guides, not guarantees.
At $940.87, Costco is a Hold. Own it if you already have a position, but wait for a broader pullback before adding exposure.
Fastenal at $45.49: A Great Business Priced for Perfection
Fastenal just delivered a clean beat, with Q2 revenue of $2.39 billion, up 14.74%, and EPS of $0.33. Contract customer daily sales grew 17.6%, now 75.8% of revenue, and June sales surged 20.5%. Returns are elite, with return on equity of 34.3% and a 1.97% dividend yield.
The bear case is the setup. Shares are up 14.6% year to date, well ahead of the S&P 500’s roughly high-single-digit gain, and trade at 39 times earnings. Gross margin compressed 75 basis points on customer mix and tariff pressure, and 2026 capex jumps to $310 million to $330 million from $230.6 million. The $47.84 analyst target across 17 analysts sits barely above the current quote, with 5 sell or strong sell ratings versus 5 buys.
At $45.49, Fastenal is a sell for new money. The analyst target sits barely above the current quote and the ratings distribution leans cautious. Wait and revisit closer to the low $40s.
Visa at $358.56: The Buffett Trifecta Still Works
Visa is the cleanest buy of the three. Q1 FY2026 net revenue rose 14.6% to $10.90 billion, payments volume grew 8% in constant dollars, and processed transactions hit 69.4 billion. Operating margin is 67.3% and return on equity is 60.4%. The quarterly payout was raised 13.6% to $0.67, now $2.68 annualized, alongside $21.1 billion left on the buyback authorization.
Valuation is reasonable for the quality on offer, at 31 times trailing and 24 times forward earnings. Shares are up just 2.66% year to date, lagging the S&P 500, which sets up a catch-up trade. The $401.47 analyst target across 40 analysts, with 37 rating it Buy or Strong Buy, implies roughly 12% upside before dividends. The interchange MDL litigation overhang is real, but reserves are already flowing through GAAP results.
At $358.56, Visa is a Buy. The combination of double-digit revenue growth, a growing dividend, aggressive buybacks, and a discounted forward multiple is the setup long-term compounders like Buffett tend to reward.
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