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Time to Buy Costco's (COST) Stock as Earnings Approach?
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With several of its Zacks Retail-Discount Industry peers already posting strong quarterly results this week, Costco’s (COST - Free Report) stock is moving higher ahead of its fiscal second quarter report on Thursday, March 7.
Notably, Ross Stores (ROST - Free Report) and Target (TGT - Free Report) were able to comfortably top earnings expectations on Wednesday with the ladder seeing its stock spike over +10% yesterday. Let’s see if it’s time to buy into Costco’s momentum with COST shares soaring +17% year to date as the large bulk retailer hopes to join Ross Stores and Target in posting favorable quarterly results.
Image Source: Zacks Investment Research
Q2 Preview & International Expansion
Costco’s Q2 earnings are expected to rise 9% to $3.60 per share with sales projected to be up 7% to $59.2 billion. The Zacks ESP (Expected Surprise Prediction) also indicates Costco could surpass its bottom line expectations with the Most Accurate Estimate having Q2 EPS slated at $3.64 a share and 1% above the Zacks Consensus.
Image Source: Zacks Investment Research
Expansion in Canada and other international locations has fueled Costco’s recent growth with the company having warehouses across Europe, Mexico, Japan, Korea, Australia, Taiwan, and China as well. Costco also operates e-commerce sites in several of these international locations and has now surpassed earnings expectations in each of its last four quarterly reports posting an average earnings surprise of 2.62%.
Image Source: Zacks Investment Research
Growth & Outlook
Costco’s annual earnings are now expected to be up 6% in fiscal 2024 and projected to climb another 9% in FY25 to $17.16 per share. Total sales are forecasted to rise 4% this year and jump another 7% in FY25 to $271.65 billion.
Furthermore, FY25 top and bottom-line projections would represent 38% and 55% growth over the last five years respectively.
Image Source: Zacks Investment Research
Bottom Line
Costco’s growth and its international expansion in particular is very intriguing with its stock landing a Zacks Rank #2 (Buy) at the moment. To that point, FY24 and FY25 earnings estimates have trended higher over the last week which is a good sign that Costco may be able to reach or exceed its bottom line expectations and extend this year’s rally.
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Time to Buy Costco's (COST) Stock as Earnings Approach?
With several of its Zacks Retail-Discount Industry peers already posting strong quarterly results this week, Costco’s (COST - Free Report) stock is moving higher ahead of its fiscal second quarter report on Thursday, March 7.
Notably, Ross Stores (ROST - Free Report) and Target (TGT - Free Report) were able to comfortably top earnings expectations on Wednesday with the ladder seeing its stock spike over +10% yesterday. Let’s see if it’s time to buy into Costco’s momentum with COST shares soaring +17% year to date as the large bulk retailer hopes to join Ross Stores and Target in posting favorable quarterly results.
Image Source: Zacks Investment Research
Q2 Preview & International Expansion
Costco’s Q2 earnings are expected to rise 9% to $3.60 per share with sales projected to be up 7% to $59.2 billion. The Zacks ESP (Expected Surprise Prediction) also indicates Costco could surpass its bottom line expectations with the Most Accurate Estimate having Q2 EPS slated at $3.64 a share and 1% above the Zacks Consensus.
Image Source: Zacks Investment Research
Expansion in Canada and other international locations has fueled Costco’s recent growth with the company having warehouses across Europe, Mexico, Japan, Korea, Australia, Taiwan, and China as well. Costco also operates e-commerce sites in several of these international locations and has now surpassed earnings expectations in each of its last four quarterly reports posting an average earnings surprise of 2.62%.
Image Source: Zacks Investment Research
Growth & Outlook
Costco’s annual earnings are now expected to be up 6% in fiscal 2024 and projected to climb another 9% in FY25 to $17.16 per share. Total sales are forecasted to rise 4% this year and jump another 7% in FY25 to $271.65 billion.
Furthermore, FY25 top and bottom-line projections would represent 38% and 55% growth over the last five years respectively.
Image Source: Zacks Investment Research
Bottom Line
Costco’s growth and its international expansion in particular is very intriguing with its stock landing a Zacks Rank #2 (Buy) at the moment. To that point, FY24 and FY25 earnings estimates have trended higher over the last week which is a good sign that Costco may be able to reach or exceed its bottom line expectations and extend this year’s rally.