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Costco (COST) Stock Sinks As Market Gains: What You Should Know

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Costco (COST - Free Report) closed at $454.93 in the latest trading session, marking a -0.88% move from the prior day. This change lagged the S&P 500's daily gain of 0.85%.

Coming into today, shares of the warehouse club operator had gained 8.4% in the past month. In that same time, the Retail-Wholesale sector lost 4.94%, while the S&P 500 gained 2.85%.

Investors will be hoping for strength from COST as it approaches its next earnings release, which is expected to be September 23, 2021. In that report, analysts expect COST to post earnings of $3.44 per share. This would mark year-over-year growth of 9.9%. Meanwhile, our latest consensus estimate is calling for revenue of $61.09 billion, up 14.43% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $10.55 per share and revenue of $194.01 billion. These totals would mark changes of +19.21% and +16.34%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for COST. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.59% higher. COST is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note COST's current valuation metrics, including its Forward P/E ratio of 43.52. Its industry sports an average Forward P/E of 24.33, so we one might conclude that COST is trading at a premium comparatively.

Also, we should mention that COST has a PEG ratio of 4.77. 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 2.04 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 39, which puts it in the top 16% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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