Costco Wholesale Corporation (NASDAQ:COST) Lowered to “Hold” at Zacks Investment Research

Costco Wholesale Corporation (NASDAQ:COST) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a research report issued to clients and investors on Monday, October 9th.

According to Zacks, “Costco continues to be one of the dominant retail wholesalers based on the breadth and quality of merchandise offered. The stock has outpaced the industry in a year gaining from sturdy comps performance and upbeat results in fourth-quarter fiscal 2017. Costco seems somewhat unfazed by tough retail scenario, comprising soft traffic and inclination toward online shopping. Moreover, we believe that the hike in annual membership fees and higher penetration of Citi Visa co-brand card program will also benefit the stock. We are also encouraged by Costco’s expansion strategy, as it remains committed to opening new clubs and expanding e-commerce capabilities. However, stiff competition and cautious consumer spending remain threats. Further, investors remain concerned about the contraction in gross margin and marginal decline in membership renewal rates that is expected to continue for at least a quarter or two. These may hurt the bottom line.”

A number of other brokerages also recently issued reports on COST. Vetr upgraded Costco Wholesale Corporation from a “buy” rating to a “strong-buy” rating and set a $182.22 price target on the stock in a report on Monday, August 21st. Oppenheimer Holdings, Inc. restated a “buy” rating on shares of Costco Wholesale Corporation in a report on Thursday, August 24th. BidaskClub downgraded Costco Wholesale Corporation from a “strong-buy” rating to a “buy” rating in a report on Tuesday, June 20th. Wells Fargo & Company restated a “hold” rating on shares of Costco Wholesale Corporation in a report on Thursday, August 3rd. Finally, Morgan Stanley downgraded Costco Wholesale Corporation from an “overweight” rating to an “equal weight” rating and reduced their price target for the company from $190.00 to $165.00 in a report on Friday, October 6th. Eleven analysts have rated the stock with a hold rating, eighteen have given a buy rating and one has issued a strong buy rating to the company’s stock. The company has an average rating of “Buy” and an average target price of $178.50.

Costco Wholesale Corporation (NASDAQ COST) traded up 1.46% during trading on Monday, reaching $160.77. The company had a trading volume of 3,993,227 shares. The stock has a 50 day moving average price of $160.74 and a 200 day moving average price of $164.19. The firm has a market capitalization of $70.29 billion, a price-to-earnings ratio of 26.44 and a beta of 0.94. Costco Wholesale Corporation has a 12 month low of $142.11 and a 12 month high of $183.18.

Costco Wholesale Corporation (NASDAQ:COST) last announced its quarterly earnings results on Thursday, October 5th. The retailer reported $2.08 earnings per share for the quarter, beating the Thomson Reuters’ consensus estimate of $2.02 by $0.06. Costco Wholesale Corporation had a net margin of 2.08% and a return on equity of 22.21%. The business had revenue of $42.30 billion during the quarter, compared to analysts’ expectations of $41.55 billion. During the same quarter in the prior year, the company posted $1.77 EPS. The firm’s revenue for the quarter was up 15.7% compared to the same quarter last year. On average, equities research analysts predict that Costco Wholesale Corporation will post $6.43 earnings per share for the current year.

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In related news, Director John W. Meisenbach sold 1,000 shares of the company’s stock in a transaction that occurred on Friday, September 1st. The stock was sold at an average price of $157.59, for a total value of $157,590.00. Following the transaction, the director now directly owns 6,974 shares of the company’s stock, valued at approximately $1,099,032.66. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Insiders sold a total of 3,000 shares of company stock worth $481,760 over the last ninety days. 0.74% of the stock is currently owned by insiders.

Several hedge funds and other institutional investors have recently added to or reduced their stakes in COST. Janus Henderson Group PLC lifted its holdings in shares of Costco Wholesale Corporation by 3,005.9% during the 2nd quarter. Janus Henderson Group PLC now owns 4,180,770 shares of the retailer’s stock valued at $668,630,000 after buying an additional 4,046,164 shares during the period. Ameriprise Financial Inc. lifted its holdings in shares of Costco Wholesale Corporation by 62.0% during the 1st quarter. Ameriprise Financial Inc. now owns 4,583,281 shares of the retailer’s stock valued at $768,568,000 after buying an additional 1,753,741 shares during the period. Harbour Capital Advisors LLC lifted its holdings in shares of Costco Wholesale Corporation by 15,937.3% during the 2nd quarter. Harbour Capital Advisors LLC now owns 1,448,646 shares of the retailer’s stock valued at $9,058,000 after buying an additional 1,439,613 shares during the period. Capital World Investors lifted its holdings in shares of Costco Wholesale Corporation by 6.0% during the 2nd quarter. Capital World Investors now owns 17,777,162 shares of the retailer’s stock valued at $2,843,102,000 after buying an additional 1,007,720 shares during the period. Finally, Vanguard Group Inc. lifted its holdings in shares of Costco Wholesale Corporation by 2.9% during the 2nd quarter. Vanguard Group Inc. now owns 33,640,766 shares of the retailer’s stock valued at $5,380,168,000 after buying an additional 937,121 shares during the period. 72.49% of the stock is currently owned by hedge funds and other institutional investors.

About Costco Wholesale Corporation

Costco Wholesale Corporation is engaged in the operation of membership warehouses in the United States and Puerto Rico, Canada, the United Kingdom, Mexico, Japan, Australia, Spain, and through its subsidiaries in Taiwan and Korea. As of August 28, 2016, the Company operated 715 warehouses across the world.

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