Costco May Have Outgrown the Club Scene

Not everyone is negative on Costco or the wholesale club market in general. The problems faced by Costco and its rivals have more to do with the broader economy and softness in consumer spending than they do with any saturation in the wholesale club market, said Todd Slater, an analyst with Lazard Freres.

"To say the industry is saturated is ignoring several hundred billion dollars in market share that's up for grabs," Slater said, adding that Costco and its wholesale rivals could increase their share of apparel, grocery, pharmacy and electronics sales among other categories.

"I think Costco is the bellwether of those three," Slater, who upped his rating on Costco from hold to buy on Thursday. "It's the most well-managed and it will reap the greatest reward when consumer spending recovers." (Lazard Freres does not have any investment banking business with Costco.)

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