Telsey Advisory Maintains Outperform Rating on Costco (COST) with Bullish View

Costco Wholesale Corporation (NASDAQ:COST) is one of the top 10 mega-cap stocks to buy according to hedge funds. On August 28, Telsey Advisory maintained its Outperform rating on Costco Wholesale Corporation (NASDAQ:COST), while setting a price target of $1,100. As of September 3, the stock was trading at $945.18, meaning the firm’s implied upside for the stock is a solid 16.37% for the next twelve months.

Analysts cited the company’s membership-based model as a key driver of stable revenue growth. That translated into membership fee income growth of  10.4% year-over-year in Q3 of Fiscal Year 2025. The company reported a renewal rate of 92.7% in the U.S. and Canada and 90.2% globally during the quarter.

Costco’s revenue has grown at a compounded annual rate of 11.1% over the last four years, while improving its net margin from 2.4% to 2.9% in that period. Telsey is only one of the many admirers of the stock. Out of the 36 Wall Street analysts tracking the stock, 21 rate it as a Strong Buy or a Buy, while 14 think it’s a Hold, and only one analyst rates it a Strong Sell. The stock does command a premium, though, as it trades at a lofty forward P/E ratio of 52.29x.

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Disclosure: None.