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Costco Wholesale (NASDAQ:COST) Trading Down 2.5% - Should You Sell?

Costco Wholesale logo with Retail/Wholesale background
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Key Points

  • Costco shares fell 2.5% on Tuesday, trading as low as $996.16 before closing near $1,002.93, with trading volume running above average. The decline came ahead of the company’s upcoming earnings report.
  • Despite the recent weakness, Wall Street remains broadly positive: analysts like Bank of America and Deutsche Bank reiterated Buy ratings, and the consensus view is still “Moderate Buy” with an average price target of about $1,052.60.
  • Recent coverage highlights both upside drivers and risks, including strong membership growth, digital sales gains, and a dividend increase, while a legal loss in a disability discrimination lawsuit and pre-earnings caution add pressure on the stock.
  • Five stocks to consider instead of Costco Wholesale.

Costco Wholesale Corporation (NASDAQ:COST - Get Free Report) shares dropped 2.5% during trading on Tuesday . The company traded as low as $996.16 and last traded at $1,002.93. Approximately 2,699,908 shares were traded during trading, an increase of 28% from the average daily volume of 2,105,494 shares. The stock had previously closed at $1,028.24.

More Costco Wholesale News

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

  • Positive Sentiment: Bank of America reiterated a Buy rating on Costco (COST) and kept a $1,185 price target, signaling confidence in the company’s long-term growth ahead of earnings. Article Title
  • Positive Sentiment: Analysts and recent coverage point to strong membership gains, digital sales growth, and AI-driven app improvements that could support continued revenue expansion. Article Title
  • Neutral Sentiment: Several previews ahead of Thursday’s earnings note that Costco is expected to post solid results, but its premium valuation may keep some investors on the sidelines until the report is out. Article Title
  • Negative Sentiment: A federal jury ruled against Costco (COST) in a disability discrimination lawsuit, adding legal and compliance risk and potentially increasing costs beyond the $200,000 damages award. Article Title
  • Negative Sentiment: Investors are trimming exposure before earnings, suggesting pre-report de-risking and valuation pressure are contributing to the recent weakness in the shares. Article Title

Analyst Ratings Changes

Several research analysts recently issued reports on COST shares. Deutsche Bank Aktiengesellschaft increased their price target on shares of Costco Wholesale from $1,104.00 to $1,106.00 and gave the stock a "buy" rating in a research report on Thursday, May 7th. Robert W. Baird set a $1,100.00 price target on shares of Costco Wholesale in a research report on Thursday, February 5th. Bank of America started coverage on shares of Costco Wholesale in a research report on Friday, February 27th. They issued a "buy" rating and a $1,185.00 price target for the company. Rothschild & Co Redburn increased their price target on shares of Costco Wholesale from $890.00 to $1,000.00 and gave the stock a "neutral" rating in a research report on Tuesday, February 17th. Finally, Mizuho increased their price target on shares of Costco Wholesale from $1,065.00 to $1,100.00 and gave the stock an "outperform" rating in a research report on Thursday, April 16th. Twenty-two equities research analysts have rated the stock with a Buy rating, eleven have assigned a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat, the stock presently has a consensus rating of "Moderate Buy" and an average price target of $1,052.60.

Read Our Latest Analysis on Costco Wholesale

Costco Wholesale Price Performance

The company has a debt-to-equity ratio of 0.18, a current ratio of 1.06 and a quick ratio of 0.59. The stock has a market capitalization of $444.95 billion, a P/E ratio of 52.15, a PEG ratio of 5.06 and a beta of 0.92. The company's 50 day simple moving average is $1,008.37 and its two-hundred day simple moving average is $960.97.

Costco Wholesale (NASDAQ:COST - Get Free Report) last issued its quarterly earnings data on Wednesday, March 11th. The retailer reported $4.58 earnings per share for the quarter, topping the consensus estimate of $4.55 by $0.03. The firm had revenue of $69.60 billion for the quarter, compared to analysts' expectations of $68.96 billion. Costco Wholesale had a net margin of 2.99% and a return on equity of 28.57%. The company's quarterly revenue was up 9.2% compared to the same quarter last year. During the same period in the prior year, the firm earned $4.02 earnings per share. As a group, equities analysts expect that Costco Wholesale Corporation will post 20.33 EPS for the current fiscal year.

Costco Wholesale Increases Dividend

The company also recently disclosed a quarterly dividend, which was paid on Friday, May 15th. Shareholders of record on Friday, May 1st were paid a dividend of $1.47 per share. This is a positive change from Costco Wholesale's previous quarterly dividend of $1.30. This represents a $5.88 annualized dividend and a yield of 0.6%. The ex-dividend date of this dividend was Friday, May 1st. Costco Wholesale's payout ratio is currently 30.58%.

Insiders Place Their Bets

In other Costco Wholesale news, EVP Claudine Adamo sold 730 shares of the company's stock in a transaction dated Monday, March 9th. The shares were sold at an average price of $1,003.02, for a total transaction of $732,204.60. Following the sale, the executive vice president directly owned 6,121 shares of the company's stock, valued at approximately $6,139,485.42. This represents a 10.66% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. Corporate insiders own 0.10% of the company's stock.

Institutional Trading of Costco Wholesale

Several hedge funds have recently modified their holdings of COST. Brighton Jones LLC grew its stake in shares of Costco Wholesale by 12.3% during the fourth quarter. Brighton Jones LLC now owns 19,825 shares of the retailer's stock valued at $18,165,000 after purchasing an additional 2,172 shares during the last quarter. Revolve Wealth Partners LLC grew its stake in shares of Costco Wholesale by 13.1% during the fourth quarter. Revolve Wealth Partners LLC now owns 1,123 shares of the retailer's stock valued at $1,029,000 after purchasing an additional 130 shares during the last quarter. Sivia Capital Partners LLC grew its stake in shares of Costco Wholesale by 4.5% during the second quarter. Sivia Capital Partners LLC now owns 3,853 shares of the retailer's stock valued at $3,814,000 after purchasing an additional 165 shares during the last quarter. Pinnacle Wealth Planning Services Inc. grew its stake in shares of Costco Wholesale by 1.1% during the second quarter. Pinnacle Wealth Planning Services Inc. now owns 2,110 shares of the retailer's stock valued at $2,089,000 after purchasing an additional 23 shares during the last quarter. Finally, Schnieders Capital Management LLC. grew its stake in shares of Costco Wholesale by 2.2% during the second quarter. Schnieders Capital Management LLC. now owns 8,502 shares of the retailer's stock valued at $8,416,000 after purchasing an additional 182 shares during the last quarter. 68.48% of the stock is owned by institutional investors.

About Costco Wholesale

(Get Free Report)

Costco Wholesale Corporation operates a global chain of membership-only warehouse clubs that sell a wide array of merchandise in bulk at discounted prices. The company's product mix includes groceries, fresh and frozen food, household goods, electronics, apparel, and seasonal items, augmented by its prominent private-label brand, Kirkland Signature. Costco's business model centers on annual membership fees and high-volume, low-margin sales, designed to drive repeat purchasing and strong customer loyalty among both consumers and small-business buyers.

Beyond merchandise, Costco provides a range of ancillary services that complement its warehouses, including gasoline stations, pharmacy and optical services, hearing aid centers, photo services, and travel and insurance products.

See Also

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

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