Commerce Bank Makes New $110.25 Million Investment in Costco Wholesale Corporation $COST

Key Points

• Commerce Bank purchased a new $110.25 million Costco stake during the second quarter, acquiring 117,857 shares. Institutional investors now own 68.48% of the company.
• Costco shares were trading at $928.48, down 1.2%, with a high valuation of about 46.7 times earnings. Analysts maintain a “Moderate Buy” consensus and an average price target of $1,059.53.
• The company paid a quarterly dividend of $1.47, equivalent to $5.88 annually and a 0.6% yield. Separately, Director Kenneth D. Denman sold 885 shares worth approximately $847,343, while insiders own just 0.10% of the stock.

Commerce Bank purchased a new stake in shares of Costco Wholesale Corporation (NASDAQ:COST - Free Report) during the second quarter, according to the company in its most recent disclosure with the SEC. The firm purchased 117,857 shares of the retailer's stock, valued at approximately $110,252,000.

A number of other large investors have also recently made changes to their positions in COST. C M Bidwell & Associates Ltd. purchased a new stake in Costco Wholesale in the second quarter worth approximately $28,000. Gunpowder Capital Management LLC dba Oliver Wealth Management bought a new position in shares of Costco Wholesale during the 4th quarter valued at $27,000. Mcguire Capital Advisors Inc. purchased a new position in shares of Costco Wholesale in the 4th quarter worth $28,000. Lifetime Wealth Management P.C. purchased a new position in shares of Costco Wholesale in the 4th quarter worth $28,000. Finally, Manning & Napier Advisors LLC grew its holdings in shares of Costco Wholesale by 750.0% in the first quarter. Manning & Napier Advisors LLC now owns 34 shares of the retailer's stock worth $34,000 after acquiring an additional 30 shares during the period. 68.48% of the stock is currently owned by institutional investors.

Insider Buying and Selling at Costco Wholesale

In other news, Director Kenneth D. Denman sold 885 shares of the stock in a transaction on Tuesday, June 23rd. The shares were sold at an average price of $957.45, for a total value of $847,343.25. Following the completion of the sale, the director directly owned 4,779 shares of the company's stock, valued at $4,575,653.55. This represents a 15.62% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. 0.10% of the stock is currently owned by insiders.

Costco Wholesale Trading Down 1.2%

Shares of NASDAQ:COST opened at $928.48 on Thursday. The stock has a 50 day moving average of $944.65 and a 200 day moving average of $978.84. The company has a market cap of $411.76 billion, a PE ratio of 46.70, a price-to-earnings-growth ratio of 3.89 and a beta of 0.87. Costco Wholesale Corporation has a 12-month low of $844.06 and a 12-month high of $1,096.50. The company has a current ratio of 1.07, a quick ratio of 0.61 and a debt-to-equity ratio of 0.17.

Costco Wholesale Announces Dividend

The company also recently declared a quarterly dividend, which was paid on Friday, August 7th. Shareholders of record on Friday, July 24th were given a $1.47 dividend. This represents a $5.88 dividend on an annualized basis and a dividend yield of 0.6%. The ex-dividend date was Friday, July 24th. Costco Wholesale's dividend payout ratio is presently 29.58%.

Analyst Upgrades and Downgrades

A number of research firms recently commented on COST. Mizuho set a $1,100.00 price objective on Costco Wholesale in a research report on Monday, June 1st. UBS Group raised their price objective on shares of Costco Wholesale from $1,205.00 to $1,275.00 and gave the stock a "buy" rating in a report on Wednesday, May 20th. Guggenheim reaffirmed a "neutral" rating on shares of Costco Wholesale in a report on Monday, June 1st. BTIG Research reiterated a "buy" rating and issued a $1,125.00 price target on shares of Costco Wholesale in a research report on Friday, May 29th. Finally, Weiss Ratings cut shares of Costco Wholesale from a "buy (b)" rating to a "buy (b-)" rating in a research note on Tuesday, June 23rd. Twenty-two research analysts have rated the stock with a Buy rating, eleven have issued a Hold rating and one has issued a Sell rating to the company's stock. Based on data from MarketBeat.com, Costco Wholesale has an average rating of "Moderate Buy" and a consensus price target of $1,059.53.

Key Headlines Impacting Costco Wholesale

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

• Positive Sentiment: Strong sales momentum supports the investment case. Costco reported August net sales of $23.70 billion, up 9.9% year over year. Fourth-quarter sales rose 11.3% to $93.9 billion, while fiscal-year sales increased 10.2% to $297.3 billion. Total comparable sales grew 8.4% for the year, and digitally enabled sales jumped 20.9%. Costco Wholesale Corporation Reports August Sales Results
• Positive Sentiment: Analyst sentiment remains favorable. Mizuho reiterated a Buy rating and maintained a $1,100 price target, citing confidence in Costco’s membership-driven growth. Recent analyst targets generally remain above the current trading level, with a reported six-month median target of $1,125. Analyst Reiterates Buy on Costco
• Neutral Sentiment: Calendar effects clouded the monthly comparison. Costco said the later timing of Labor Day reduced August total and comparable sales growth by slightly less than 75 basis points. Underlying performance remained positive, but investors may look for confirmation in the next report.
• Negative Sentiment: Costco Next was abruptly discontinued. The company shut down the online Costco Next marketplace without notice. While the service is unlikely to materially affect near-term financial results, the move could disappoint members and remove a customer-engagement perk. Costco has ended this online service without notice
• Negative Sentiment: Regulatory uncertainty increased. The U.S. Department of Justice expanded an investigation into rising beef prices to include Costco and other major retailers. Potential reputational, legal, or margin-related consequences create an overhang, although no wrongdoing has been established. DOJ expands beef price investigation
• Negative Sentiment: Valuation leaves little room for disappointment. Costco trades at roughly 47 times earnings, with a PEG ratio above 4, and shares remain below their 50-day and 200-day moving averages. Insider activity has also consisted of sales rather than purchases in recent months, adding to investor caution.

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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