Costco Wholesale Corporation $COST Stock: Sterling Capital Management LLC Decreases Stake

Key Points

• Sterling Capital Management cut its Costco stake by 24.8% in the third quarter, selling 4,504 shares and retaining 13,681 shares valued at approximately $12.45 million. Institutional investors collectively own 68.48% of Costco.
• Costco executives also reported insider selling: William Richard Wilcox sold 1,100 shares and Claudine Adamo sold 2,200 shares. Insiders now own just 0.10% of the company.
• Despite the selling, Costco reported quarterly EPS and revenue above estimates, while analysts maintain a “Moderate Buy” consensus with an average price target of $1,086.19. However, the stock’s high valuation and intensifying competition remain key risks.

Sterling Capital Management LLC trimmed its holdings in shares of Costco Wholesale Corporation (NASDAQ:COST - Free Report) by 24.8% in the 3rd quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission. The fund owned 13,681 shares of the retailer's stock after selling 4,504 shares during the quarter. Sterling Capital Management LLC's holdings in Costco Wholesale were worth $12,454,000 at the end of the most recent reporting period.

A number of other large investors have also recently made changes to their positions in COST. Contravisory Investment Management Inc. increased its stake in Costco Wholesale by 107.7% in the 3rd quarter. Contravisory Investment Management Inc. now owns 27 shares of the retailer's stock worth $25,000 after buying an additional 14 shares during the period. C M Bidwell & Associates Ltd. purchased a new stake in Costco Wholesale in the 2nd quarter valued at about $28,000. Burk Holdings LLC purchased a new stake in Costco Wholesale in the 2nd quarter valued at about $30,000. Manning & Napier Advisors LLC purchased a new stake in Costco Wholesale in the 2nd quarter valued at about $30,000. Finally, Bullseye Investment Management LLC bought a new position in Costco Wholesale in the 2nd quarter worth about $35,000. 68.48% of the stock is owned by hedge funds and other institutional investors.

Insider Activity

In other Costco Wholesale news, EVP William Richard Wilcox sold 1,100 shares of the stock in a transaction dated Tuesday, October 13th. The shares were sold at an average price of $958.21, for a total transaction of $1,054,031.00. Following the completion of the sale, the executive vice president directly owned 3,094 shares of the company's stock, valued at approximately $2,964,701.74. This represents a 26.23% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through this hyperlink. Also, EVP Claudine Adamo sold 2,200 shares of the firm's stock in a transaction dated Tuesday, September 29th. The shares were sold at an average price of $915.93, for a total transaction of $2,015,046.00. Following the completion of the sale, the executive vice president owned 7,134 shares in the company, valued at $6,534,244.62. This represents a 23.57% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. 0.10% of the stock is owned by insiders.

Key Stories Impacting Costco Wholesale

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

• Positive Sentiment: Analyst support remains strong. CICC initiated coverage with an Outperform rating, while Tigress Financial raised its price target to $1,250. Erste Group also increased its FY2028 EPS estimate to $25.07 from $25.01, above the current-year consensus estimate of $22.70. CICC coverage article Tigress Financial price target article
• Positive Sentiment: Growth and customer engagement remain key positives. Costco’s membership model has delivered substantial long-term shareholder returns, and the company is reportedly using purchasing data to better target high-spending members. REJURAN Cosmetics is also expanding through Costco’s first Beauty Table program, potentially adding traffic and broadening its premium beauty offering. Costco customer spending article REJURAN retail expansion article
• Neutral Sentiment: Long-term growth screens are favorable, and analysts’ average recommendation is equivalent to a Buy. However, these reports largely reiterate existing optimism rather than provide a new earnings catalyst. Zacks growth stock article
• Negative Sentiment: Valuation and competition remain concerns. Costco trades at a high earnings multiple, leaving the stock sensitive to profit-taking or disappointing growth. Kroger is planning major investments and price cuts to win back market share from Costco and Walmart, which could intensify grocery competition and pressure margins. Kroger competition article

Costco Wholesale Stock Down 1.5%

Shares of NASDAQ COST opened at $1,003.32 on Friday. Costco Wholesale Corporation has a 12-month low of $844.06 and a 12-month high of $1,096.50. The stock's fifty day simple moving average is $937.96 and its two-hundred day simple moving average is $963.21. The stock has a market capitalization of $444.60 billion, a PE ratio of 48.33, a price-to-earnings-growth ratio of 4.29 and a beta of 0.88. The company has a current ratio of 1.06, a quick ratio of 0.62 and a debt-to-equity ratio of 0.11.

Costco Wholesale (NASDAQ:COST - Get Free Report) last released its quarterly earnings results on Thursday, September 24th. The retailer reported $6.75 EPS 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 analyst estimates of $94.97 billion. Costco Wholesale had a return on equity of 27.60% and a net margin of 3.04%. The business's revenue for the quarter was up 11.1% compared to the same quarter last year. During the same period in the previous year, the company posted $5.87 EPS. As a group, analysts expect that Costco Wholesale Corporation will post 22.70 EPS for the current fiscal year.

Costco Wholesale Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Friday, November 13th. Shareholders of record on Friday, October 30th will be paid a $1.47 dividend. This represents a $5.88 annualized dividend and a yield of 0.6%. The ex-dividend date is Friday, October 30th. Costco Wholesale's payout ratio is 28.32%.

Analyst Ratings Changes

A number of equities analysts have recently commented on the stock. JPMorgan Chase & Co. reduced their target price on shares of Costco Wholesale from $1,100.00 to $1,015.00 and set an "overweight" rating on the stock in a research report on Friday, September 25th. HSBC raised shares of Costco Wholesale to a "buy" rating in a research note on Friday, September 25th. Bank of America lowered their price target on Costco Wholesale from $1,200.00 to $1,095.00 and set a "buy" rating for the company in a report on Wednesday, September 16th. TD Cowen reissued a "buy" rating on shares of Costco Wholesale in a research note on Friday, September 25th. Finally, DA Davidson increased their price objective on Costco Wholesale from $1,000.00 to $1,040.00 and gave the stock a "neutral" rating in a research note on Friday, September 25th. Twenty-five research analysts have rated the stock with a Buy rating, eight have issued a Hold rating and one has given a Sell rating to the company. According to MarketBeat.com, Costco Wholesale presently has a consensus rating of "Moderate Buy" and a consensus target price of $1,086.19.

Costco Wholesale Company Profile

Costco Wholesale Corporation operates a membership-based warehouse retail business under the Costco name. The company sells merchandise in bulk and at competitive prices through warehouse clubs and e-commerce platforms, serving individual consumers, businesses and other organizations.

Its product selection includes groceries and fresh foods, household supplies, appliances, electronics, furniture, apparel, health and beauty products, jewelry, automotive products and prescription drugs. Costco also provides services such as optical care, pharmacy services, hearing-aid sales, travel offerings and fuel sales, depending on location.

The company traces its roots to Price Club, which opened in San Diego in 1976.

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