Costco Wholesale (NASDAQ:COST) Stock Falls 1.1% – Should You Sell?

Costco Wholesale Corporation (NASDAQ:COST) dropped 1.1% on Friday. The stock traded as low as $1,043.00 and last traded at $1,053.56. Approximately 2,483,467 shares traded hands during mid-day trading, an increase of 12% from the average session volume of 2,209,918 shares. The stock had previously closed at $1,065.59.

Costco Wholesale News Roundup

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

• Positive Sentiment: October net sales rose 12.6% year over year to $24.50 billion. Comparable sales were also strong, and digital growth accelerated, reinforcing the company’s sales momentum. Article: Costco’s October Net Sales Jump 12.6% as Digital Growth Accelerates
• Positive Sentiment: JPMorgan raised its price target from $1,015 to $1,150 and maintained an Overweight rating. Bank of America also reiterated its Buy rating after U.S. comparable sales improved. Article: Costco retains BofA buy as October US comps rise
• Neutral Sentiment: Analyst views remain divided: the sales performance and momentum are supportive, but the next move may depend on whether earnings growth can justify the stock’s valuation. Article: Costco Stock: Why Analysts Are Split Despite Strong October Sales
• Negative Sentiment: Valuation is the main risk: commentary highlights a roughly 49-times trailing earnings multiple, which could leave shares vulnerable if growth or earnings estimates disappoint. Citi maintained a Hold rating with a $1,020 target, below the recent share price. Article: Costco Stock: Earnings Growth Could Shape the Next Big Move

Analyst Ratings Changes

Several analysts have recently issued reports on the stock. CICC Research began coverage on shares of Costco Wholesale in a research report on Wednesday, October 21st. They set an “outperform” rating and a $1,050.00 price target on the stock. TD Cowen began coverage on shares of Costco Wholesale in a report on Friday, October 30th. They issued a “strong-buy” rating for the company. Deutsche Bank Aktiengesellschaft cut their target price on shares of Costco Wholesale from $1,091.00 to $1,079.00 and set a “buy” rating on the stock in a research note on Monday, September 28th. Evercore reiterated an “outperform” rating on shares of Costco Wholesale in a report on Tuesday, September 22nd. Finally, UBS Group reiterated a “buy” rating on shares of Costco Wholesale in a report on Thursday, September 17th. One investment analyst has rated the stock with a Strong Buy rating, twenty-four have given a Buy rating, eight have assigned a Hold rating and one has given a Sell rating to the company. According to MarketBeat, the company presently has a consensus rating of “Moderate Buy” and an average target price of $1,090.55.

Costco Wholesale Stock Down 1.1%

The business has a 50-day simple moving average of $950.04 and a 200-day simple moving average of $972.05. 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 company has a market cap of $466.86 billion, a price-to-earnings ratio of 50.75, a price-to-earnings-growth ratio of 4.47 and a beta of 0.85.

Costco Wholesale (NASDAQ:COST) last announced its quarterly earnings data on Thursday, September 24th. The retailer reported $6.75 EPS for the quarter, topping analysts’ consensus estimates of $6.54 by $0.21. Costco Wholesale had a return on equity of 27.60% and a net margin of 3.04%. The business had revenue of $95.72 billion during the quarter, compared to the consensus estimate of $94.97 billion. During the same period in the previous year, the company posted $5.87 earnings per share. The business’s revenue for the quarter was up 11.1% on a year-over-year basis. On average, equities analysts anticipate that Costco Wholesale Corporation will post 22.70 earnings per share for the current fiscal year.

Costco Wholesale Dividend Announcement

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

Insider Activity at Costco Wholesale

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

Institutional Investors Weigh In On Costco Wholesale

Institutional investors have recently added to or reduced their stakes in the business. Money Concepts Capital Corp increased its position in Costco Wholesale by 2.3% during the third quarter. Money Concepts Capital Corp now owns 3,405 shares of the retailer’s stock worth $3,100,000 after buying an additional 75 shares during the period. Allworth Financial LP boosted its holdings in shares of Costco Wholesale by 18.6% in the third quarter. Allworth Financial LP now owns 75,527 shares of the retailer’s stock valued at $70,653,000 after acquiring an additional 11,824 shares during the period. GKV Capital Management Co. Inc. boosted its holdings in shares of Costco Wholesale by 3.2% in the third quarter. GKV Capital Management Co. Inc. now owns 9,084 shares of the retailer’s stock valued at $8,270,000 after acquiring an additional 284 shares during the period. Fisher Asset Management LLC boosted its holdings in shares of Costco Wholesale by 1.2% in the third quarter. Fisher Asset Management LLC now owns 3,291,669 shares of the retailer’s stock valued at $2,996,538,000 after acquiring an additional 38,629 shares during the period. Finally, Altar Rock LLC purchased a new position in shares of Costco Wholesale during the third quarter worth approximately $202,000. Hedge funds and other institutional investors own 68.48% of the company’s stock.

Costco Wholesale Company Profile

Costco Wholesale Corporation operates membership-based warehouse clubs that offer a broad selection of merchandise at generally low prices. Its products include groceries, fresh foods, appliances, electronics, apparel, furniture, and household goods, as well as its Kirkland Signature private-label line.

The company also provides services such as gasoline stations, pharmacies, optical and hearing-aid centers, food courts, and travel offerings. Costco serves members through warehouses and online channels.

Founded in 1983 in Seattle, Costco has expanded across North America, Europe, Asia, and Australia.