Costco (COST) – Research Analysts’ Recent Ratings Updates
A number of firms have modified their ratings and price targets on shares of Costco (NASDAQ: COST) recently:
- Costco had its price target raised by analysts at Robert W. Baird from $105.00 to $113.00. They now have an “outperform” rating on the stock.
- Costco had its price target raised by analysts at Credit Suisse from $93.00 to $115.00. They now have an “outperform” rating on the stock.
- Costco had its “neutral” rating reaffirmed by analysts at Zacks. They now have a $107.00 price target on the stock. Zacks‘ analyst wrote, “Costco continues to be a dominant warehouse club operator posting a healthy fourth-quarter 2012 results. The quarterly earnings of $1.39 per share beat the Zacks Consensus Estimate of $1.30, and rose 28.7% from the prior-year quarter buoyed by a double-digit growth in the top-line. Comparable-store sales for the quarter rose 5%, buoyed by a 6% and 2% jump in comparable-store sales in the U.S. and international locations, respectively. We believe that Costco is well positioned to weather the sluggish recovery in the economy given its focus on low prices. Besides, it would also maintain its growth momentum as evident from its monthly sales results. Costco’s comparable-store sales for September rose 6%, reflecting comps growth of 6% at its U.S. locations and 7% at its international outlets. However, aggressive pricing to counter competition, gain market share and drive traffic may depress sales and margins.”
- Costco had its “equalweight” rating reaffirmed by analysts at Barclays Capital.
- Costco was upgraded by analysts at BMO Capital Markets from an “underperform” rating to a “market perform” rating. They now have a $106.00 price target on the stock. They wrote, “A central fundamental tenet of our UNDERPERFORM thesis was our concern about contraction in the company’s core gross margin rate and the risk it posed to maintaining margin, ex-membership fee income. While core margin rate came under pressure over the past six quarters, the rate of pressure has moderated sequentially, leaving us less concerned. Moreover, 4Q12 operating margin, ex-MFI, improved sequentially on favorable expense leverage, and worldwide renewal rates were up slightly to 86.4% despite the November 2011 fee increase.”
- Costco had its price target raised by analysts at Guggenheim to $98.00.
- Costco had its price target raised by analysts at Deutsche Bank from $107.00 to $110.00. They now have a “buy” rating on the stock. They wrote, “Our Buy rating is predicated on Costco’s (1) healthy, traffic-led SSS trends; (2) multiple EBIT margin drivers, including the cycling of last year’s offensive price investments (beginning in September 2012); (3) an acceleration in club growth in FY13; & (4) multiple layers of EPS cushion (MFI Increase/Buybacks). These strengths give us more confidence that Costco can play offense and defense at the same time – a unique set-up in retail today. We see material upside.”
Costco opened at 96.78 on Thursday. Costco has a 52-week low of $78.81 and a 52-week high of $104.43. The company has a market cap of $41.851 billion and a price-to-earnings ratio of 24.94.
Costco Wholesale Corporation (Costco), with its subsidiaries operates membership warehouses that offer its members low prices on a limited selection of branded and selected private-label products in a range of merchandise categories.