Jim Cramer Shares Investment Legend Charlie Munger's Advice For Costco Wholesale Corporation (COST)

We recently published 10 Latest Stocks on Jim Cramer’s Radar. Costco Wholesale Corporation (NASDAQ:COST) is one of the stocks Jim Cramer recently discussed.

Costco Wholesale Corporation (NASDAQ:COST)’s shares are up by 3.2% year-to-date but have lost 1.7% over the past month. The recent under-performance comes on the back of a 5.3% drop in August. However, Cramer continues to be a Costco Wholesale Corporation (NASDAQ:COST) fan and reiterated his opinion that the firm does its best to ensure low prices for consumers:

“Look I’ve always said the secret and it has been ever since Richard Galanti was the CFO, he’s now retired, of Costco, is that’s like the TVA. . .meaning that if someone raises price too much, like if you’re Tito’s, and your big customer is Costco’s, and you raise your price [inaudible] suddenly there’s Kirkland Vodka and it taste tests every bit as good. And anyone who does not play ball with Costco, they offer you a choice, lower your prices or we’ll come after you. And their beef prices are the lowest. Their chicken prices, remember when they got tired of being, hurting chickens, so they decided to make, you know, become a chicken farmer. So I think that Costco, if I were to be in front of the Federal Reserve, I’d say listen you gotta go twofold, you gotta look at Walmart and Costco. Now Walmart has passed on, unfortunately they’ve had to pass on some tariffs, but Costco is, I don’t think Costco’s all that much more expensive than it used to be. That is a little bit anecdotal, but I follow Costco really closely and they don’t let people riase prices the way that others do.

“. . .When I shop at Costco I say wow, I mean let’s buy more.

“Yeah, that’s why, look Costco stock has been weaker. Oh it always has these periods where it’s been weaker. But the late Charlie Munger always said it was just that, you know it’s an expensive stock, it will always be an expensive stock, I wanna own it.”

While we acknowledge the potential of COST as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.

Disclosure: None. This article is originally published at Insider Monkey.