Arizona State Retirement System Grows Stake in Costco Wholesale Corporation $COST

Key Points

• Arizona State Retirement System increased its Costco stake by 1.2% in the second quarter, bringing its holdings to 123,105 shares valued at approximately $115.2 million.
• Institutional investors and hedge funds own 68.48% of Costco’s shares, with several other firms also increasing their positions during the quarter.
• Analysts maintain a “Moderate Buy” consensus with an average price target of $1,056.03, though Costco’s premium valuation and a modest 0.6% dividend yield leave limited room for disappointing results.

Arizona State Retirement System boosted its stake in Costco Wholesale Corporation (NASDAQ:COST - Free Report) by 1.2% during the second quarter, according to its most recent 13F filing with the Securities and Exchange Commission. The institutional investor owned 123,105 shares of the retailer's stock after buying an additional 1,493 shares during the quarter. Costco Wholesale makes up approximately 0.6% of Arizona State Retirement System's portfolio, making the stock its 27th largest holding. Arizona State Retirement System's holdings in Costco Wholesale were worth $115,161,000 at the end of the most recent reporting period.

A number of other institutional investors have also recently made changes to their positions in COST. Waverly Advisors LLC increased its position in shares of Costco Wholesale by 79.2% during the second quarter. Waverly Advisors LLC now owns 87,623 shares of the retailer's stock worth $81,968,000 after purchasing an additional 38,723 shares in the last quarter. Bank OZK lifted its holdings in Costco Wholesale by 6.1% in the 2nd quarter. Bank OZK now owns 4,663 shares of the retailer's stock valued at $4,362,000 after purchasing an additional 269 shares in the last quarter. Empirical Finance LLC lifted its holdings in Costco Wholesale by 3.6% in the 2nd quarter. Empirical Finance LLC now owns 15,385 shares of the retailer's stock valued at $14,392,000 after purchasing an additional 531 shares in the last quarter. Nykredit A S acquired a new stake in Costco Wholesale during the 2nd quarter worth $113,356,000. Finally, Parkside Financial Bank & Trust boosted its stake in Costco Wholesale by 1.3% during the 2nd quarter. Parkside Financial Bank & Trust now owns 3,215 shares of the retailer's stock worth $3,008,000 after purchasing an additional 41 shares during the last quarter. 68.48% of the stock is owned by institutional investors and hedge funds.

Costco Wholesale News Summary

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

• Positive Sentiment: Dividend increase supports the investment case. Costco recently raised its dividend by 13%, reinforcing confidence in cash generation and adding to the appeal of the membership-based retailer, although the regular yield remains modest and special dividends can make the headline payout appear higher. Costco dividend article
• Positive Sentiment: Long-term business fundamentals remain a bullish backdrop. Analysts and commentators continue to point to Costco’s scale, limited product assortment, purchasing advantages and resilient same-store sales as reasons the stock could recover after trailing the S&P 500 and trading below its 52-week high. Fourth-quarter results, expected later this month, are the next major potential catalyst. Costco earnings preview
• Neutral Sentiment: Motor-oil pricing reflects supply pressures rather than a company-specific demand problem. Costco raised the price of a 10-quart case of Kirkland Signature full-synthetic motor oil to $57.99 and limited purchases to two cases per member per week. The changes follow higher crude-oil prices and supply disruptions linked to Middle East tensions and Saudi Arabia’s East-West pipeline closure. Higher prices may protect margins, but the restrictions could affect customer sentiment. Costco motor oil article
• Negative Sentiment: Rationing and sharply higher prices create reputational and traffic risks. Reports that Costco has also capped purchases of Mobil 1 oil—and that some motor-oil prices have risen substantially from last year—evoke earlier pandemic-era product shortages. While the merchandise is a small portion of revenue, frustrated members could view the move negatively or defer purchases. Costco motor oil rationing article
• Negative Sentiment: Valuation leaves limited room for disappointment. Costco trades at a premium earnings multiple, so investors may require strong sales, membership trends and profit guidance from the upcoming report to justify the valuation. Rising merchandise and operating costs could pressure margins if Costco cannot pass them through broadly. Costco stock performance article

Wall Street Analyst Weigh In

A number of equities research analysts have recently commented on COST shares. Freedom Broker upgraded shares of Costco Wholesale from a "hold" rating to a "buy" rating and set a $1,030.00 target price for the company in a research report on Tuesday, September 8th. Weiss Ratings lowered shares of Costco Wholesale from a "buy (b-)" rating to a "hold (c+)" rating in a research report on Wednesday, September 2nd. Citigroup assumed coverage on shares of Costco Wholesale in a research note on Thursday, June 18th. They set a "neutral" rating and a $1,020.00 price objective for the company. TD Cowen reiterated a "buy" rating and issued a $1,175.00 price objective on shares of Costco Wholesale in a report on Wednesday, June 3rd. Finally, Roth Capital raised their target price on shares of Costco Wholesale from $769.00 to $781.00 and gave the stock a "sell" rating in a research note on Friday, May 29th. Twenty-two research analysts have rated the stock with a Buy rating, twelve have assigned a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, Costco Wholesale has a consensus rating of "Moderate Buy" and an average price target of $1,056.03.

Insider Transactions at Costco Wholesale

In related news, Director Kenneth Denman sold 885 shares of the business's stock in a transaction dated Tuesday, June 23rd. The shares were sold at an average price of $957.45, for a total value of $847,343.25. Following the sale, the director directly owned 4,779 shares in the company, valued at approximately $4,575,653.55. The trade was a 15.62% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this link. Company insiders own 0.10% of the company's stock.

Costco Wholesale Price Performance

Shares of COST stock opened at $918.91 on Tuesday. The company has a debt-to-equity ratio of 0.17, a current ratio of 1.07 and a quick ratio of 0.61. The firm's 50-day moving average is $939.46 and its two-hundred day moving average is $973.86. Costco Wholesale Corporation has a 12 month low of $844.06 and a 12 month high of $1,096.50. The company has a market capitalization of $407.52 billion, a PE ratio of 46.22, a price-to-earnings-growth ratio of 3.77 and a beta of 0.86.

Costco Wholesale Dividend Announcement

The firm also recently disclosed a quarterly dividend, which was paid on Friday, August 7th. Investors of record on Friday, July 24th were given a dividend of $1.47 per share. This represents a $5.88 dividend on an annualized basis and a dividend yield of 0.6%. The ex-dividend date of this dividend was Friday, July 24th. Costco Wholesale's dividend payout ratio (DPR) is presently 29.58%.

Costco Wholesale 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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