Zacks Investment Research upgraded shares of Costco Wholesale (NASDAQ:COST) from a hold rating to a buy rating in a research report report published on Tuesday morning, Zacks.com reports. They currently have $272.00 target price on the retailer’s stock.
According to Zacks, “Costco continues to be one of the dominant retail wholesalers based on the breadth and quality of merchandise offered. The stock, which outpaced the industry in a year, has been gaining from sturdy comps and decent results. The company posted positive earnings surprise in the third quarter of fiscal 2019 but revenues fell short of the Zacks Consensus Estimate. Notably, the top and the bottom line continued to rise year over year. Certainly, Costco seems somewhat unfazed by tough retail scenario. We believe growth strategies, increase in membership fees and sturdy e-commerce sales bode well. The company’s efforts have been driving traffic across online and brick-and-mortar platforms. However, any incremental investments or aggressive pricing strategy may hurt margins. Moreover, rising SG&A expenses and stiff competition also pose concerns.”
COST has been the subject of a number of other research reports. Raymond James lifted their target price on shares of Costco Wholesale from $240.00 to $250.00 and gave the stock an outperform rating in a report on Friday, March 8th. Nomura lifted their target price on shares of Costco Wholesale from $230.00 to $235.00 and gave the stock a neutral rating in a report on Thursday, April 11th. Citigroup lifted their target price on shares of Costco Wholesale from $242.00 to $243.00 and gave the stock a neutral rating in a report on Monday, April 1st. Morgan Stanley set a $220.00 target price on shares of Costco Wholesale and gave the stock a hold rating in a report on Friday, March 8th. Finally, Evercore ISI initiated coverage on shares of Costco Wholesale in a report on Wednesday, March 20th. They set an outperform rating and a $260.00 target price for the company. Seven equities research analysts have rated the stock with a hold rating and eighteen have assigned a buy rating to the stock. The stock currently has a consensus rating of Buy and a consensus price target of $252.13.
Costco Wholesale (NASDAQ:COST) last released its earnings results on Thursday, May 30th. The retailer reported $1.89 EPS for the quarter, topping analysts’ consensus estimates of $1.83 by $0.06. Costco Wholesale had a net margin of 2.41% and a return on equity of 25.03%. The firm had revenue of $34.74 billion during the quarter, compared to analyst estimates of $34.72 billion. During the same quarter in the previous year, the business earned $1.70 EPS. The business’s quarterly revenue was up 7.4% compared to the same quarter last year. Equities analysts expect that Costco Wholesale will post 8.04 EPS for the current year.
Costco Wholesale declared that its Board of Directors has initiated a stock repurchase plan on Friday, April 26th that permits the company to repurchase $4.00 billion in shares. This repurchase authorization permits the retailer to buy up to 3.8% of its shares through open market purchases. Shares repurchase plans are often a sign that the company’s leadership believes its shares are undervalued.
The company also recently declared a quarterly dividend, which was paid on Friday, May 24th. Stockholders of record on Friday, May 10th were issued a $0.65 dividend. This is a positive change from Costco Wholesale’s previous quarterly dividend of $0.57. The ex-dividend date was Thursday, May 9th. This represents a $2.60 annualized dividend and a dividend yield of 1.01%. Costco Wholesale’s payout ratio is 38.07%.
In other news, Director Susan L. Decker sold 2,350 shares of the business’s stock in a transaction on Tuesday, March 26th. The shares were sold at an average price of $240.00, for a total value of $564,000.00. Following the completion of the transaction, the director now owns 46,239 shares of the company’s stock, valued at approximately $11,097,360. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, insider James C. Klauer sold 5,000 shares of the business’s stock in a transaction on Friday, June 7th. The shares were sold at an average price of $255.53, for a total transaction of $1,277,650.00. Following the completion of the transaction, the insider now directly owns 48,310 shares of the company’s stock, valued at approximately $12,344,654.30. The disclosure for this sale can be found here. Insiders sold a total of 12,140 shares of company stock valued at $3,056,340 in the last three months. 0.21% of the stock is owned by company insiders.
Several hedge funds have recently made changes to their positions in COST. Kistler Tiffany Companies LLC lifted its position in Costco Wholesale by 1.5% during the 1st quarter. Kistler Tiffany Companies LLC now owns 2,771 shares of the retailer’s stock worth $671,000 after buying an additional 41 shares in the last quarter. Parisi Gray Wealth Management raised its holdings in shares of Costco Wholesale by 8.3% in the 1st quarter. Parisi Gray Wealth Management now owns 561 shares of the retailer’s stock valued at $136,000 after purchasing an additional 43 shares during the period. Nachman Norwood & Parrott Inc raised its holdings in shares of Costco Wholesale by 4.1% in the 1st quarter. Nachman Norwood & Parrott Inc now owns 1,109 shares of the retailer’s stock valued at $269,000 after purchasing an additional 44 shares during the period. Nichols & Pratt Advisers LLP MA raised its holdings in shares of Costco Wholesale by 0.9% in the 1st quarter. Nichols & Pratt Advisers LLP MA now owns 5,018 shares of the retailer’s stock valued at $1,215,000 after purchasing an additional 44 shares during the period. Finally, Franklin Street Advisors Inc. NC raised its holdings in shares of Costco Wholesale by 1.9% in the 1st quarter. Franklin Street Advisors Inc. NC now owns 2,314 shares of the retailer’s stock valued at $560,000 after purchasing an additional 44 shares during the period. 71.14% of the stock is owned by institutional investors.
About Costco Wholesale
Costco Wholesale Corporation, together with its subsidiaries, operates membership warehouses. It offers branded and private-label products in a range of merchandise categories. The company provides dry and packaged foods, and groceries; snack foods, candies, alcoholic and nonalcoholic beverages, and cleaning supplies; appliances, electronics, health and beauty aids, hardware, and garden and patio products; meat, bakery, deli, and produces; and apparel and small appliances.
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