Costco (COST) Dips More Than Broader Markets: What You Should Know
In the latest trading session, Costco (COST) closed at $492.11, marking a -0.1% move from the previous day. This change lagged the S&P 500's daily loss of 0.07%. Meanwhile, the Dow gained 0.31%, and the Nasdaq, a tech-heavy index, lost 3.22%.
Coming into today, shares of the warehouse club operator had gained 6.48% in the past month. In that same time, the Retail-Wholesale sector gained 8.58%, while the S&P 500 gained 4.64%.
Wall Street will be looking for positivity from Costco as it approaches its next earnings report date. In that report, analysts expect Costco to post earnings of $3.21 per share. This would mark year-over-year growth of 9.93%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $55.56 billion, up 7.05% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $14.28 per share and revenue of $243.22 billion, which would represent changes of +8.68% and +7.17%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for Costco. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.09% higher. Costco is currently sporting a Zacks Rank of #3 (Hold).
In terms of valuation, Costco is currently trading at a Forward P/E ratio of 34.51. Its industry sports an average Forward P/E of 26.94, so we one might conclude that Costco is trading at a premium comparatively.
It is also worth noting that COST currently has a PEG ratio of 3.61. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. COST's industry had an average PEG ratio of 2.5 as of yesterday's close.
The Retail - Discount Stores industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 190, which puts it in the bottom 25% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow COST in the coming trading sessions, be sure to utilize Zacks.com.
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Costco Wholesale Corporation (COST) : Free Stock Analysis Report
