Costco Beats Q4 Estimates as Eight Analysts Cut Price Targets

Insider Monkey··US·Read original
3▲1 ▼0Impact / 5
Summary · why it matters

Costco Wholesale Corporation reported fourth-quarter results on September 24 that beat expectations, with net sales up 11.2% to $93.9 billion and earnings of $6.75 a share, and the stock rose 2.93% to close at $922.77. Comparable sales rose 9.4% companywide and 10.7% in the United States, while digitally enabled sales grew 19.5%, the fastest-moving part of the business. The sixteen-week quarter closed a fiscal year in which net sales reached $297.2 billion, and Costco finished the year operating 939 warehouses worldwide. Earnings included a non-recurring benefit of $0.15 a share from tariff refunds, so excluding that the quarter was still ahead of expectations but by less than the headline suggests. At least eight research firms lowered their price targets the following day, led by Truist, which cut its target to $955 from $1,011 while keeping a Hold rating, and Bernstein, which trimmed its target by a single dollar to $1,143 from $1,144 while keeping an Outperform rating; JPMorgan cut to $1,015 from $1,100 and stayed Overweight. The cuts centered on slowing membership growth rather than the quarter itself, and the day was not one-directional, as HSBC upgraded the stock to Buy and DA Davidson raised its target to $1,040. Costco earned $20.76 a share across the fiscal year, leaving the stock trading near 44 times what the business actually produced, with the average Wall Street target still above $1,045.

Impact on assets 5

Consumer Staples▲ · 2 stocks
Costco Wholesale Corp
COST
▲ PositiveCapitalrelevance

Costco beat Q4 estimates with net sales up 11.2% to $93.9B and EPS of $6.75, though eight analysts cut price targets on slowing membership growth.

Financials▲ · 2 stocks
HSBC Holdings PLC
HSBA
± MixedCapitalrelevance

HSBC upgraded Costco to Buy, one of the non-one-directional analyst moves.

Truist Financial Corp
TFC
± MixedCapitalrelevance

Truist led the price-target cuts, lowering its Costco target to $955 from $1,011 while keeping a Hold rating.

Digital Finance & Tokenization▲ · 1 stocks
JPMorgan Chase & Co
JPM
± MixedCapitalrelevance

JPMorgan cut its Costco price target to $1,015 from $1,100 while staying Overweight.

Off-coverage companies 1

Bernstein (Societe Generale / AllianceBernstein JV)Private± Mixed
Capitalrelevance

Bernstein trimmed its Costco price target by a dollar to $1,143 while keeping an Outperform rating.

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