Costco (COST) Stock Sinks As Market Gains: What You Should Know

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In the latest trading session, Costco (COST) closed at $358.81, marking a -0.36% move from the previous day. This move lagged the S&P 500’s daily gain of 0.15%.

Coming into today, shares of the warehouse club operator had gained 15.86% in the past month. In that same time, the Retail-Wholesale sector gained 3.01%, while the S&P 500 gained 6.19%.

Wall Street will be looking for positivity from COST as it approaches its next earnings report date. This is expected to be May 27, 2021. The company is expected to report EPS of $2.21, up 16.93% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $42.45 billion, up 13.9% from the year-ago period.

COST’s full-year Zacks Consensus Estimates are calling for earnings of $9.89 per share and revenue of $187.39 billion. These results would represent year-over-year changes of +11.75% and +12.37%, respectively.

Any recent changes to analyst estimates for COST should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.

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 ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.23% higher. COST is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, COST is holding a Forward P/E ratio of 36.49. This represents a premium compared to its industry’s average Forward P/E of 26.49.

Also, we should mention that COST has a PEG ratio of 4.16. 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 2.34 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 230, which puts it in the bottom 10% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. 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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Costco Wholesale Corporation (COST) : Free Stock Analysis Report
 
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