Buy Costco Stock
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Costco Wholesale has adopted Direct Registration, a book-entry form of stock ownership. When you purchase Costco Common Stock through the direct stock purchase plan, a stock certificate will not be issued, unless specifically requested.
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So you may wonder whether now is really the right time to buy shares of Costco (COST 1.10%). The warehouse retail giant has outperformed the S&P 500 this year -- but the stock still has lost about 13%. And the most recent sales report showed a slowdown. Let's take a closer look before deciding whether to go for this stock right now.
So it looks like Costco is a great stock to buy no matter what the economy is doing. But what about valuation Today, the stock is trading at 33 times forward earnings estimates. That's down from more than 45 earlier this year.
After seeing those numbers, many folks might be interested in investing in Costco. However, the company recently delivered disappointing news that must be considered before taking a position. So let's dive in and see whether Costco is a buy or if you should pass on the stock.
With the stock trading for 33 times forward earnings, it's valued about 50% higher than other retailers like Walmart and Target. When a stock is valued that much more than its peers, it must consistently beat expectations or risk being sold off. That's precisely what happened the day after the earnings report; the stock dropped about 2% although it was down over 4% during some parts of the trading session.
This could be a major catalyst for the stock, sending it higher. Or it may do nothing to the shares and decrease its valuation to be more in line with its peers. Regardless, Costco remains a solid company, even when consumers aren't willing to spend as much. For this execution, you have to pay a high multiple for the stock.
If Costco continues to post disappointing revenue numbers, the stock will likely keep slumping given it's still priced for perfection. I doubt consumers' strength will return this quarter (or the next), so it may be best to wait for Costco to reach a more attractive valuation level before purchasing the stock.
Costco stock last closed at $491.48, up 0.12% from the previous day, and has decreased 14.74% in one year. It has underperformed other stocks in the Discount Stores industry by 0.02 percentage points. Costco stock is currently +20.9% from its 52-week low of $406.51, and -19.73% from its 52-week high of $612.27.
November is usually strong in months that are two years past an election such as this year. In fact, the following 15 months after a mid-term election have a very bullish history. It is also a strong month for many stocks.
Costco has been strong in November, rising 79% of the time over the last 29 years. The average gain has been over 3%. There are higher lows in momentum both daily and weekly. The stock is very oversold monthly. The stock is likely to break out of the triangle that has been in force since May. Such a development is likely to push the stock closer to the $550 area.
I ditched corporate America in 1994 and started a management consulting and venture capital firm ( ). I began following stocks in 1981 when I was in grad school at MIT and first analyzed tech stocks as a guest on CNBC in 1998. I became a Forbes contributor in April 2011. My 15th book -- published in November 2020 -- is \\\"Goliath Strikes Back: How Traditional Retailers Are Winning Back Customers from Ecommerce Startups.\\\" I appeared eight times in the 2016 documentary: \\\"We The People: The Market Basket Effect.\\\" ( ). I also teach business strategy and entrepreneurship at Babson College in Wellesley, Mass. ( -Peter.aspx)
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The current consensus among 34 polled investment analysts is to Buy stock in Costco Wholesale Corp. This rating has held steady since March, when it was unchanged from a Buy rating.Move your mouse over pastmonths for detail
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As you can see, most things on my list aren't necessarily for specific meals. Rather, they are staples that we try to keep on-hand at all times if I shop in bulk once a month. By keeping up with the coupons and stocking up on the items that are on sale that month at Costco, we tend to always have the things we need on-hand so we don't have to pay full price for them in a time of need.
First up, a little tip! Learn your prices and don't impulse buy furniture and appliances. Those are NOT always the best deals at Costco. To see a great video showing other great insider tips of shopping at Costco, click HERE. Only buy items that you will actually use. It's not worth it to stock up on something that will sit in your cupboards for the next year or two and never be used.
In the past three months, Costco Wholesale insiders have sold more of their company's stock than they have bought. Specifically, they have bought $0.00 in company stock and sold $2,992,156.00 in company stock.
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