#2 - Costco (NASDAQ:COST)
Costco Wholesale Corporation (NASDAQ:COST) stock is down nearly 20% for the year. Despite that, the stock still carries a hefty P/E ratio of 34x earnings. That means by most measures the stock is still overvalued. At the same time, analysts still give the stock a price target of $552, which suggests an upside of 21%.
But Costco has the benefit of being a members-only retail outlet. This brings to mind two catalysts. First, the company has retained its membership despite increasing its membership fee. Second, once consumers pay that fee, they’re more likely to shop at Costco because they want to get value from the membership. Plus, Costco locations also provide gas stations.
Costco took the unprecedented stop of leasing three container ships along with several thousand containers to help manage its supply chain in 2022. That helped them control prices and pass those savings on to its customers. And even in doing this, the company continues to deliver growth in both revenue and earnings.
About Costco Wholesale
Costco Wholesale Corporation, together with its subsidiaries, engages in the operation of membership warehouses in the United States, Puerto Rico, Canada, Mexico, Japan, the United Kingdom, Korea, Australia, Taiwan, China, Spain, France, Iceland, New Zealand, and Sweden. The company offers branded and private-label products in a range of merchandise categories.
More about Costco Wholesale- Current Price
- $999.03
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 21 Buy Ratings, 9 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $1,024.03 (2.5% Upside)
