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Costco (COST) Gains As Market Dips: What You Should Know
In the latest trading session, Costco (COST - Free Report) closed at $515.59, marking a +0.15% move from the previous day. This change outpaced the S&P 500's 0.61% loss on the day. Meanwhile, the Dow lost 0.1%, and the Nasdaq, a tech-heavy index, lost 0.67%.
Coming into today, shares of the warehouse club operator had gained 6.61% in the past month. In that same time, the Retail-Wholesale sector gained 10.67%, while the S&P 500 gained 8.32%.
Investors will be hoping for strength from Costco as it approaches its next earnings release, which is expected to be March 2, 2023. The company is expected to report EPS of $3.20, up 9.59% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $55.61 billion, up 7.15% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $14.25 per share and revenue of $243.3 billion, which would represent changes of +8.45% and +7.2%, respectively, from the prior year.
Any recent changes to analyst estimates for Costco should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.1% lower. Costco is holding a Zacks Rank of #3 (Hold) right now.
Looking at its valuation, Costco is holding a Forward P/E ratio of 36.13. For comparison, its industry has an average Forward P/E of 22.81, which means Costco is trading at a premium to the group.
Investors should also note that COST has a PEG ratio of 3.78 right now. 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 2.03 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 192, which puts it in the bottom 24% 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.