Costco Wholesale (NASDAQ:COST) Trading Up 2.6% - Still a Buy?

Key Points

• Costco shares rose 2.6% on the day, trading near record highs as investors reacted to continued momentum in the stock.
• Fundamentals remain strong: Costco raised its quarterly dividend by 13% to $1.47 per share and reported April comparable sales growth of 11.6%, with digital sales up 18.8%.
• Wall Street remains bullish: Several analysts reiterated or raised price targets, and the consensus rating is still Moderate Buy, with a target price below recent trading levels.

Costco Wholesale Corporation (NASDAQ:COST - Get Free Report) shares were up 2.6% on Monday . The stock traded as high as $1,079.83 and last traded at $1,076.47. Approximately 2,177,039 shares changed hands during mid-day trading, an increase of 4% from the average daily volume of 2,088,806 shares. The stock had previously closed at $1,048.95.

Costco Wholesale News Roundup

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

• Positive Sentiment: Costco raised its quarterly dividend by 13% to $1.47 per share, a signal of confidence in cash flow that can attract income-focused investors. Costco (COST) Surges to New 52-Week Peak Following Strong Dividend Boost
• Positive Sentiment: April sales remained strong, with 11.6% comparable sales growth and 18.8% digital growth, reinforcing Costco’s reputation as a defensive retailer benefiting from value-conscious shoppers. Costco's April Sales Reinforce Its Case as the Ultimate Defensive Stock
• Positive Sentiment: Costco’s expansion of mixsoon into about 500 U.S. warehouse locations highlights continued merchandising strength and successful product launches. Strong U.S. Retail Demand Fuels mixsoon's Expansion Across Costco's Global Markets
• Positive Sentiment: Analyst commentary has been upbeat, with multiple pieces highlighting Costco’s resilient growth, strong execution, and potential for a breakout as the stock trades near record levels. Prediction: The Stage is Set for a Costco Stock Breakout
• Neutral Sentiment: One report noted a Florida land purchase for future expansion, which supports long-term growth but is not an immediate earnings catalyst. How Investors Are Reacting To Costco Wholesale (COST) Double-Digit April Sales, Florida Expansion And Jury Verdict
• Neutral Sentiment: There was also a small legal setback tied to a disability discrimination verdict, but the dollar amount reported was modest relative to Costco’s scale. How Investors Are Reacting To Costco Wholesale (COST) Double-Digit April Sales, Florida Expansion And Jury Verdict

Analyst Upgrades and Downgrades

A number of brokerages have recently issued reports on COST. Sanford C. Bernstein reissued an "outperform" rating and set a $1,192.00 price objective on shares of Costco Wholesale in a research report on Tuesday, May 12th. Bank of America began coverage on Costco Wholesale in a research report on Friday, February 27th. They set a "buy" rating and a $1,185.00 target price on the stock. Evercore set a $1,100.00 price target on Costco Wholesale in a report on Monday, March 2nd. Rothschild & Co Redburn raised their price objective on Costco Wholesale from $890.00 to $1,000.00 and gave the stock a "neutral" rating in a research note on Tuesday, February 17th. Finally, Telsey Advisory Group lifted their price objective on Costco Wholesale from $1,125.00 to $1,135.00 and gave the company an "outperform" rating in a research report on Thursday, April 9th. Twenty-two equities research analysts have rated the stock with a Buy rating, eleven have issued a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat.com, the company currently has a consensus rating of "Moderate Buy" and an average price target of $1,047.27.

Costco Wholesale Price Performance

The company has a debt-to-equity ratio of 0.18, a quick ratio of 0.59 and a current ratio of 1.06. The company has a market cap of $477.58 billion, a P/E ratio of 55.98, a P/E/G ratio of 5.16 and a beta of 0.92. The firm's fifty day moving average is $1,000.90 and its two-hundred day moving average is $955.24.

Costco Wholesale (NASDAQ:COST - Get Free Report) last announced its quarterly earnings data on Wednesday, March 11th. The retailer reported $4.58 EPS for the quarter, beating the consensus estimate of $4.55 by $0.03. The business had revenue of $69.60 billion for the quarter, compared to the consensus estimate of $68.96 billion. Costco Wholesale had a return on equity of 28.57% and a net margin of 2.99%.The business's revenue was up 9.2% on a year-over-year basis. During the same period in the previous year, the business earned $4.02 earnings per share. As a group, analysts anticipate that Costco Wholesale Corporation will post 20.31 earnings per share for the current fiscal year.

Costco Wholesale Increases Dividend

The firm also recently declared a quarterly dividend, which was paid on Friday, May 15th. Investors of record on Friday, May 1st were issued a $1.47 dividend. The ex-dividend date of this dividend was Friday, May 1st. This represents a $5.88 dividend on an annualized basis and a yield of 0.5%. This is a boost from Costco Wholesale's previous quarterly dividend of $1.30. Costco Wholesale's payout ratio is presently 30.58%.

Insider Transactions at Costco Wholesale

In other Costco Wholesale news, EVP Claudine Adamo sold 730 shares of the stock in a transaction that occurred on 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 completion of the sale, the executive vice president directly owned 6,121 shares of the company's stock, valued at $6,139,485.42. This trade represents a 10.66% decrease in their position. The sale was disclosed in a filing with the SEC, which is available through the SEC website. 0.10% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Costco Wholesale

Institutional investors have recently bought and sold shares of the stock. Brighton Jones LLC boosted its position in shares of Costco Wholesale by 12.3% during the 4th quarter. Brighton Jones LLC now owns 19,825 shares of the retailer's stock valued at $18,165,000 after acquiring an additional 2,172 shares during the last quarter. Revolve Wealth Partners LLC increased its position in Costco Wholesale by 13.1% in the fourth quarter. Revolve Wealth Partners LLC now owns 1,123 shares of the retailer's stock worth $1,029,000 after purchasing an additional 130 shares during the last quarter. Sivia Capital Partners LLC raised its stake in 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 in the last quarter. Pinnacle Wealth Planning Services Inc. raised its stake in 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 in the last quarter. Finally, Schnieders Capital Management LLC. lifted its position in 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 hedge funds and other institutional investors.

About Costco Wholesale

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.

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