Costco Wholesale (NASDAQ:COST) Stock Price Down 1.3% - Here's What Happened

Key Points

• Costco shares fell 1.3% to about $992.13 during Tuesday trading, with volume roughly in line with the average session.
• The company recently exceeded quarterly expectations, reporting $6.75 EPS and $95.72 billion in revenue, while AI-driven search traffic and expanded health-benefit services could support future e-commerce growth and member engagement.
• Despite a “Moderate Buy” analyst consensus and an average price target of $1,086.19, valuation remains a key concern because Costco trades at a premium earnings multiple; the company also declared a quarterly dividend of $1.47 per share.

Costco Wholesale Corporation (NASDAQ:COST - Get Free Report)'s stock price fell 1.3% during trading on Tuesday. The stock traded as low as $989.04 and last traded at $992.13. 2,226,488 shares changed hands during mid-day trading, an increase of 1% from the average session volume of 2,195,043 shares. The stock had previously closed at $1,005.16.

Key Stories Impacting Costco Wholesale

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

• Positive Sentiment: Costco reportedly delivered its fifth consecutive earnings beat, while its defensive membership model and recent share-price strength support the case for further long-term gains. Costco Remains a Defensive Compounder Awaiting Its Next Leg Up
• Positive Sentiment: AI-driven search traffic is growing rapidly and producing strong online conversion rates, potentially giving Costco a new source of e-commerce growth. Costco's AI Search Traffic Soars
• Positive Sentiment: Costco is expanding health-related offerings, including pharmacy services and a nationwide integration with NationsBenefits that allows eligible members to use benefit cards at more than 600 warehouses. These initiatives could improve member engagement and renewals. NationsBenefits Expands Member Access to Health Benefits Across Costco Stores Nationwide
• Neutral Sentiment: Technical analyst Katie Stockton sees improving momentum heading into November, which may support the shares if buying interest continues. Costco Momentum Is Improving Heading Into November
• Neutral Sentiment: Costco is offering new Gold Star members a $45 digital shop card with a $65 membership, a promotion that could encourage sign-ups but may modestly reduce initial membership economics. New Costco Gold Star Members Get a $45 Digital Costco Shop Card With Sign-Up
• Negative Sentiment: Valuation remains the primary concern: analysts and commentators note that COST trades at a premium earnings multiple, requiring sustained flawless execution to justify its price. Is Costco Wholesale Fully Valued?
• Negative Sentiment: Exchange-traded funds were net sellers of Costco shares on October 23, adding near-term technical pressure. ETFs Are Net Sellers of Costco
• Negative Sentiment: Costco withdrew an application for a proposed warehouse near Highway 55 in Eagle, removing one potential source of future unit expansion in that market. Costco Pulls Application for Warehouse Near Highway 55 in Eagle

Analysts Set New Price Targets

COST has been the subject of a number of recent analyst reports. HSBC upgraded shares of Costco Wholesale to a "buy" rating in a research report on Friday, September 25th. BMO Capital Markets reaffirmed an "outperform" rating on shares of Costco Wholesale in a research note on Friday, September 25th. Wells Fargo & Company dropped their price objective on shares of Costco Wholesale from $1,000.00 to $950.00 and set an "equal weight" rating for the company in a report on Friday, September 25th. TD Cowen reiterated a "buy" rating on shares of Costco Wholesale in a research note on Friday, September 25th. Finally, Royal Bank Of Canada reissued a "sector perform" rating and issued a $1,000.00 target price on shares of Costco Wholesale in a report on Friday, October 9th. Twenty-five analysts have rated the stock with a Buy rating, eight 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 currently has an average rating of "Moderate Buy" and an average price target of $1,086.19.

Costco Wholesale Trading Down 1.3%

The company's 50-day moving average is $938.87 and its 200-day moving average is $968.09. The company has a debt-to-equity ratio of 0.11, a quick ratio of 0.62 and a current ratio of 1.06. The firm has a market cap of $439.64 billion, a price-to-earnings ratio of 47.79, a P/E/G ratio of 4.29 and a beta of 0.88.

Costco Wholesale (NASDAQ:COST - Get Free Report) last posted its quarterly earnings data on Thursday, September 24th. The retailer reported $6.75 earnings per share for the quarter, beating the consensus estimate of $6.54 by $0.21. Costco Wholesale had a net margin of 3.04% and a return on equity of 27.60%. The firm had revenue of $95.72 billion during the quarter, compared to analysts' expectations of $94.97 billion. During the same quarter last year, the company posted $5.87 EPS. The company's quarterly revenue was up 11.1% compared to the same quarter last year. On average, research analysts predict that Costco Wholesale Corporation will post 22.70 earnings per share for the current year.

Costco Wholesale Announces Dividend

The business also recently declared a quarterly dividend, which will be paid on Friday, November 13th. Investors of record on Friday, October 30th will be issued a $1.47 dividend. The ex-dividend date of this dividend is Friday, October 30th. This represents a $5.88 dividend on an annualized basis and a dividend yield of 0.6%. Costco Wholesale's dividend payout ratio (DPR) is currently 28.32%.

Insider Buying and Selling

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

Hedge Funds Weigh In On Costco Wholesale

Several hedge funds have recently added to or reduced their stakes in the company. State Street Corp boosted its stake in shares of Costco Wholesale by 31.7% in the 2nd quarter. State Street Corp now owns 23,901,594 shares of the retailer's stock valued at $22,359,224,000 after purchasing an additional 5,749,362 shares during the last quarter. Bank of America Corp DE boosted its stake in Costco Wholesale by 11.5% in 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 acquiring an additional 773,651 shares during the last quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC grew its holdings in Costco Wholesale by 5.5% during the 2nd quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 3,068,312 shares of the retailer's stock worth $2,870,314,000 after acquiring an additional 160,893 shares during the period. Amundi grew its holdings in Costco Wholesale by 11.1% during the 1st quarter. Amundi now owns 2,839,016 shares of the retailer's stock worth $2,828,881,000 after acquiring an additional 283,360 shares during the period. Finally, Ascentis Wealth Management LLC raised its position in shares of Costco Wholesale by 103,637.0% during the 2nd quarter. Ascentis Wealth Management LLC now owns 2,500,062 shares of the retailer's stock valued at $2,549,616,000 after acquiring an additional 2,497,652 shares during the last quarter. Institutional investors own 68.48% of the company's stock.

About Costco Wholesale

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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