DA Davidson Issues Positive Forecast for Costco Wholesale (NASDAQ:COST) Stock Price

Key Points

• DA Davidson raised Costco’s price target from $1,000 to $1,040 while maintaining a neutral rating, implying 13.14% upside from the cited share price. The broader analyst consensus is “Moderate Buy,” with an average target of $1,047.42.
• Costco exceeded quarterly expectations, reporting $6.75 in EPS versus $6.54 expected and $95.72 billion in revenue versus $94.97 billion forecast. Comparable sales rose 9.4%, while digitally enabled comparable sales increased 19.5%.
• Despite strong demand and institutional ownership of 68.48%, Costco’s premium valuation and potential margin pressures remain concerns. The earnings beat included an approximately $0.15-per-share one-time tariff-refund benefit, while rising electronics costs could weigh on profitability.

Costco Wholesale (NASDAQ:COST - Get Free Report) had its price target upped by equities research analysts at DA Davidson from $1,000.00 to $1,040.00 in a report issued on Friday, Benzinga reports. The brokerage presently has a "neutral" rating on the retailer's stock. DA Davidson's price target indicates a potential upside of 13.14% from the company's current price.

Several other brokerages have also recently weighed in on COST. Raymond James Financial reiterated an "outperform" rating and set a $1,050.00 price target on shares of Costco Wholesale in a research report on Friday. Wells Fargo & Company reduced their price objective on Costco Wholesale from $1,000.00 to $950.00 and set an "equal weight" rating on the stock in a research report on Friday. Evercore reiterated an "outperform" rating on shares of Costco Wholesale in a research report on Tuesday. The Goldman Sachs Group increased their price objective on Costco Wholesale from $1,088.00 to $1,159.00 and gave the company a "buy" rating in a research note on Friday, May 29th. Finally, Truist Financial reduced their price target on Costco Wholesale from $1,011.00 to $955.00 and set a "hold" rating on the stock in a report on Friday. Twenty-three research analysts have rated the stock with a Buy rating, ten have given a Hold rating and one has assigned a Sell rating to the company. According to data from MarketBeat, the stock has an average rating of "Moderate Buy" and a consensus price target of $1,047.42.

Costco Wholesale Stock Performance

COST traded up $22.73 during trading hours on Friday, hitting $919.21. The stock had a trading volume of 1,336,827 shares, compared to its average volume of 2,178,490. Costco Wholesale has a 1 year low of $844.06 and a 1 year high of $1,096.50. The company's fifty day simple moving average is $934.32 and its 200 day simple moving average is $968.18. The stock has a market cap of $407.65 billion, a PE ratio of 46.30, a price-to-earnings-growth ratio of 3.78 and a beta of 0.86. The company has a quick ratio of 0.61, a current ratio of 1.07 and a debt-to-equity ratio of 0.17.

Costco Wholesale (NASDAQ:COST - Get Free Report) last posted its earnings results on Thursday, September 24th. The retailer reported $6.75 earnings per share for the quarter, topping the consensus estimate of $6.54 by $0.21. The firm had revenue of $95.72 billion during the quarter, compared to the consensus estimate of $94.97 billion. Costco Wholesale had a net margin of 3.01% and a return on equity of 28.04%. Equities analysts anticipate that Costco Wholesale will post 20.42 earnings per share for the current year.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently modified their holdings of COST. QRG Capital Management Inc. boosted its position in shares of Costco Wholesale by 42.0% during the second quarter. QRG Capital Management Inc. now owns 117,027 shares of the retailer's stock valued at $109,475,000 after buying an additional 34,608 shares during the last quarter. Envestnet Portfolio Solutions Inc. raised its position in Costco Wholesale by 49.6% in the 2nd quarter. Envestnet Portfolio Solutions Inc. now owns 21,023 shares of the retailer's stock worth $19,666,000 after buying an additional 6,969 shares during the last quarter. Envestnet Asset Management Inc. raised its position in Costco Wholesale by 68.9% in the 2nd quarter. Envestnet Asset Management Inc. now owns 1,042,046 shares of the retailer's stock worth $974,803,000 after buying an additional 424,982 shares during the last quarter. State Street Corp lifted its stake in Costco Wholesale by 31.7% during 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 during the period. Finally, Silicon Valley Capital Partners lifted its stake in Costco Wholesale by 2.3% during the 2nd quarter. Silicon Valley Capital Partners now owns 12,243 shares of the retailer's stock valued at $11,419,000 after acquiring an additional 271 shares during the period. 68.48% of the stock is owned by institutional investors.

Key Costco Wholesale News

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

• Positive Sentiment: Costco reported fourth-quarter EPS of $6.75 versus the $6.54 consensus estimate and revenue of $95.72 billion versus $94.97 billion expected. Net income rose 14.9% to approximately $3 billion. Costco earnings beat expectations
• Positive Sentiment: Underlying demand remained healthy, with fourth-quarter comparable sales increasing 9.4% and digitally enabled comparable sales jumping 19.5%. Strong traffic, pharmacy sales and e-commerce momentum support the company’s growth outlook. Costco beats quarterly sales estimates
• Positive Sentiment: Several analysts remain bullish. Mizuho lowered its target to $1,065 while retaining an Outperform rating, and Bernstein set a $1,143 target with the same rating. UBS also maintained a $1,275 Buy target, implying substantial upside from the reference price.
• Neutral Sentiment: The earnings beat included a roughly $0.15-per-share benefit from IEEPA tariff refunds, meaning some of the upside was non-recurring. Costco’s reported $6.75 EPS therefore may overstate the quarter’s sustainable earnings power. Costco posts fourth-quarter net income rise
• Negative Sentiment: Costco’s premium valuation remains a major obstacle: shares trade at roughly 45 times earnings despite a market capitalization near $398 billion. Analysts warn that slowing membership growth and the eventual fading benefit of the 2024 membership-fee increase could limit further multiple expansion.
• Negative Sentiment: Management flagged rising electronics costs tied to memory inflation, creating potential margin pressure. This, combined with the one-time tariff benefit and elevated valuation, helps explain why the stock’s earnings reaction has been weaker than the headline results might suggest. Costco flags rising electronics costs

Costco Wholesale Company Profile

Costco Wholesale Corporation operates membership-based warehouse clubs that offer a broad selection of merchandise at generally competitive prices. Its product range includes groceries, fresh foods, apparel, appliances, electronics, furniture, jewelry, hardware, and seasonal goods, along with private-label products sold under the Kirkland Signature brand.

The company also provides a variety of ancillary services, including gasoline stations, pharmacies, optical centers, hearing-aid centers, food courts, tire centers, and travel services.

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