Costco (COST) closed the most recent trading day at $936.94, moving +1.03% from the previous trading session. The stock's change was more than the S&P 500's daily loss of 1.54%. At the same time, the Dow lost 1.63%, and the tech-heavy Nasdaq lost 1.63%.
Shares of the warehouse club operator witnessed a loss of 6.17% over the previous month, trailing the performance of the Retail-Wholesale sector with its loss of 4.27% and the S&P 500's loss of 2.2%.
The investment community will be paying close attention to the earnings performance of Costco in its upcoming release. The company is predicted to post an EPS of $4.05, indicating a 9.16% growth compared to the equivalent quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $62.74 billion, indicating a 7.36% upward movement from the same quarter last year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $18.01 per share and revenue of $272.46 billion, which would represent changes of +11.79% and +7.08%, respectively, from the prior year.
Any recent changes to analyst estimates for Costco should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.35% higher. Costco currently has a Zacks Rank of #3 (Hold).
Looking at its valuation, Costco is holding a Forward P/E ratio of 51.5. For comparison, its industry has an average Forward P/E of 21.37, which means Costco is trading at a premium to the group.
Investors should also note that COST has a PEG ratio of 5.54 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The average PEG ratio for the Retail - Discount Stores industry stood at 2.29 at the close of the market yesterday.
The Retail - Discount Stores industry is part of the Retail-Wholesale sector. This industry, currently bearing a Zacks Industry Rank of 177, finds itself in the bottom 30% echelons of all 250+ industries.
The Zacks Industry Rank is ordered 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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