Northwestern Mutual Wealth Management Co. Takes Position in Costco Wholesale Corporation $COST

Key Points

• Northwestern Mutual Wealth Management acquired 189,471 Costco shares in the second quarter, worth approximately $177.2 million. Institutional investors collectively own 68.48% of the company.
• Costco continues to show strong sales momentum: August net sales rose 9.9% year over year, while fiscal-year sales increased 10.2% to $297.3 billion and digitally enabled sales jumped 20.9%.
• Analysts remain broadly positive, but valuation and regulatory risks persist. Costco has a “Moderate Buy” consensus rating, while shares trade at roughly 47 times earnings amid a DOJ investigation into beef pricing and concerns that the stock is priced for strong execution.

Northwestern Mutual Wealth Management Co. acquired a new stake in shares of Costco Wholesale Corporation (NASDAQ:COST - Free Report) during the 2nd quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC). The firm acquired 189,471 shares of the retailer's stock, valued at approximately $177,244,000.

Several other large investors also recently bought and sold shares of the business. Geode Capital Management LLC lifted its stake in Costco Wholesale by 0.3% during the 4th quarter. Geode Capital Management LLC now owns 10,388,519 shares of the retailer's stock valued at $8,919,573,000 after acquiring an additional 26,690 shares during the period. Morgan Stanley grew its stake in shares of Costco Wholesale by 1.1% in the fourth quarter. Morgan Stanley now owns 9,523,423 shares of the retailer's stock worth $8,212,433,000 after acquiring an additional 107,775 shares during the period. Bank of America Corp DE raised its holdings in shares of Costco Wholesale by 11.5% during the first quarter. Bank of America Corp DE now owns 7,515,031 shares of the retailer's stock valued at $7,488,203,000 after purchasing an additional 773,651 shares during the last quarter. Diamant Asset Management Inc. raised its holdings in shares of Costco Wholesale by 99,278.0% during the first quarter. Diamant Asset Management Inc. now owns 6,726,899 shares of the retailer's stock valued at $672,690,000 after purchasing an additional 6,720,130 shares during the last quarter. Finally, Corient Private Wealth LLC lifted its position in Costco Wholesale by 838.9% during the fourth quarter. Corient Private Wealth LLC now owns 6,125,405 shares of the retailer's stock valued at $5,282,182,000 after purchasing an additional 5,472,968 shares during the period. 68.48% of the stock is currently owned by institutional investors.

Key Stories 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.

Analysts Set New Price Targets

Several brokerages recently issued reports on COST. Guggenheim restated a "neutral" rating on shares of Costco Wholesale in a report on Monday, June 1st. JPMorgan Chase & Co. decreased their target price on shares of Costco Wholesale from $1,110.00 to $1,100.00 and set an "overweight" rating for the company in a research note on Thursday, July 9th. BTIG Research reissued a "buy" rating and set a $1,125.00 price target on shares of Costco Wholesale in a report on Friday, May 29th. Royal Bank Of Canada began coverage on Costco Wholesale in a research note on Monday, July 13th. They issued a "sector perform" rating and a $1,000.00 price target on the stock. Finally, The Goldman Sachs Group lifted their price objective on Costco Wholesale from $1,088.00 to $1,159.00 and gave the stock a "buy" rating in a report on Friday, May 29th. Twenty-two investment 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. Based on data from MarketBeat, the stock currently has a consensus rating of "Moderate Buy" and an average price target of $1,059.53.

Insider Buying and Selling

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

Costco Wholesale Trading Down 1.2%

NASDAQ:COST opened at $928.48 on Thursday. 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 has a market capitalization of $411.76 billion, a price-to-earnings ratio of 46.70, a price-to-earnings-growth ratio of 3.89 and a beta of 0.87. Costco Wholesale Corporation has a one year low of $844.06 and a one year high of $1,096.50. The business has a fifty day moving average price of $944.65 and a 200-day moving average price of $978.84.

Costco Wholesale Announces Dividend

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

Costco Wholesale Company Profile

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.

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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