Costco Wholesale (NASDAQ:COST) Stock Jumps 2.8% – Should You Buy?

Costco Wholesale Corporation (NASDAQ:COST)’s stock price traded up 2.8% during trading on Monday. The company traded as high as $1,042.56 and last traded at $1,040.55. Approximately 3,104,804 shares were traded during mid-day trading, an increase of 41% from the average session volume of 2,200,425 shares. The stock had previously closed at $1,012.28.

Costco Wholesale News Summary

Here are the key news stories impacting Costco Wholesale this week:

• Positive Sentiment: Costco reported October net sales of $24.50 billion, up 12.6% year over year. The solid growth supports the view that customer demand and the warehouse model remain healthy. Costco reports October sales results
• Neutral Sentiment: Costco’s defensive reputation and loyal membership base may appeal to investors seeking stability in uncertain markets, though this is not a new company-specific catalyst. Costco’s capital-preservation role
• Negative Sentiment: Recent commentary warns that COST’s valuation already reflects substantial optimism. With shares above $1,000 and a rich earnings multiple, the stock may be vulnerable if earnings growth does not justify expectations; the company’s healthcare initiatives have not removed that concern. Costco stock valuation and healthcare push

Wall Street Analysts Forecast Growth

Several research firms have recently weighed in on COST. Oppenheimer reiterated an “outperform” rating and set a $1,160.00 price objective on shares of Costco Wholesale in a research report on Wednesday, September 16th. Freedom Broker dropped their target price on shares of Costco Wholesale from $1,030.00 to $1,010.00 and set a “buy” rating on the stock in a report on Friday, September 25th. TD Cowen began coverage on shares of Costco Wholesale in a research report on Friday, October 30th. They set a “strong-buy” rating on the stock. Sanford C. Bernstein decreased their price target on Costco Wholesale from $1,144.00 to $1,143.00 and set an “outperform” rating for the company in a report on Friday, September 25th. Finally, CICC Research assumed coverage on Costco Wholesale in a research report on Wednesday, October 21st. They issued an “outperform” rating and a $1,050.00 price objective for the company. One analyst has rated the stock with a Strong Buy rating, twenty-four have given a Buy rating, eight have issued a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat, Costco Wholesale presently has a consensus rating of “Moderate Buy” and a consensus target price of $1,086.19.

Costco Wholesale Trading Up 2.7%

The company has a market cap of $463.72 billion, a price-to-earnings ratio of 49.84, a P/E/G ratio of 4.36 and a beta of 0.85. The company has a current ratio of 1.06, a quick ratio of 0.62 and a debt-to-equity ratio of 0.11. The firm’s 50-day moving average price is $947.85 and its 200 day moving average price is $971.54.

Costco Wholesale (NASDAQ:COST) last released its quarterly earnings data on Thursday, September 24th. The retailer reported $6.75 earnings per share for the quarter, beating the consensus estimate of $6.54 by $0.21. The company had revenue of $95.72 billion during the quarter, compared to analyst estimates of $94.97 billion. Costco Wholesale had a net margin of 3.04% and a return on equity of 27.60%. Costco Wholesale’s revenue for the quarter was up 11.1% compared to the same quarter last year. During the same quarter in the previous year, the business posted $5.87 EPS. As a group, equities analysts expect that Costco Wholesale Corporation will post 22.70 EPS for the current year.

Costco Wholesale Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Friday, November 13th. Shareholders of record on Friday, October 30th will be paid a $1.47 dividend. This represents a $5.88 annualized dividend and a yield of 0.6%. The ex-dividend date of this dividend is Friday, October 30th. Costco Wholesale’s payout ratio is 28.32%.

Insider Activity

In other news, EVP Claudine Adamo sold 2,200 shares of the stock in a transaction dated Tuesday, September 29th. The shares were sold at an average price of $915.93, for a total transaction of $2,015,046.00. Following the transaction, the executive vice president owned 7,134 shares of the company’s stock, valued at $6,534,244.62. This represents a 23.57% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, EVP William Richard Wilcox sold 1,100 shares of the stock in a transaction dated Tuesday, October 13th. The stock was sold at an average price of $958.21, for a total transaction of $1,054,031.00. Following the transaction, the executive vice president directly owned 3,094 shares in the company, valued at $2,964,701.74. This trade represents a 26.23% decrease in their position. The SEC filing for this sale provides additional information. 0.10% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently added to or reduced their stakes in COST. State Street Corp lifted its position in Costco Wholesale by 31.7% in the 2nd quarter. State Street Corp now owns 23,901,594 shares of the retailer’s stock valued at $22,359,224,000 after acquiring an additional 5,749,362 shares in the last quarter. Bank of America Corp DE boosted its stake in Costco Wholesale by 11.5% during the 1st quarter. Bank of America Corp DE now owns 7,515,031 shares of the retailer’s stock valued at $7,488,203,000 after purchasing an additional 773,651 shares during the last quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC increased its holdings in Costco Wholesale by 5.5% during the 2nd quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 3,068,312 shares of the retailer’s stock worth $2,870,314,000 after purchasing an additional 160,893 shares in the last quarter. Amundi increased its holdings in Costco Wholesale by 11.1% during the 1st quarter. Amundi now owns 2,839,016 shares of the retailer’s stock worth $2,828,881,000 after purchasing an additional 283,360 shares in the last quarter. Finally, Legal & General Group Plc purchased a new stake in shares of Costco Wholesale in the second quarter worth approximately $2,362,188,000. Institutional investors own 68.48% of the company’s stock.

Costco Wholesale Company Profile

Costco Wholesale Corporation operates a membership-based warehouse retail business under the Costco name. The company sells merchandise in bulk and at competitive prices through warehouse clubs and e-commerce platforms, serving individual consumers, businesses and other organizations.

Its product selection includes groceries and fresh foods, household supplies, appliances, electronics, furniture, apparel, health and beauty products, jewelry, automotive products and prescription drugs. Costco also provides services such as optical care, pharmacy services, hearing-aid sales, travel offerings and fuel sales, depending on location.

The company traces its roots to Price Club, which opened in San Diego in 1976.