In the latest trading session, Costco (COST) closed at $932.14, marking a -1.05% move from the previous day. The stock's change was less than the S&P 500's daily gain of 0.79%. Elsewhere, the Dow gained 1.01%, while the tech-heavy Nasdaq added 1.15%.
The stock of warehouse club operator has fallen by 0.13% in the past month, leading the Retail-Wholesale sector's loss of 1.37% and undershooting the S&P 500's gain of 1.27%.
The upcoming earnings release of Costco will be of great interest to investors. The company is expected to report EPS of $4.24, up 10.99% from the prior-year quarter. In the meantime, our current consensus estimate forecasts the revenue to be $67.2 billion, indicating a 8.12% growth compared to the corresponding quarter of the prior year.
COST's full-year Zacks Consensus Estimates are calling for earnings of $19.97 per share and revenue of $296.49 billion. These results would represent year-over-year changes of +11.01% and +7.72%, respectively.
Investors should also take note of any recent adjustments to analyst estimates for Costco. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.51% higher. Costco currently has a Zacks Rank of #3 (Hold).
Digging into valuation, Costco currently has a Forward P/E ratio of 47.16. This indicates a premium in contrast to its industry's Forward P/E of 25.32.
Investors should also note that COST has a PEG ratio of 5.72 right now. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The average PEG ratio for the Retail - Discount Stores industry stood at 2.74 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 35, finds itself in the top 15% echelons of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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Costco Wholesale Corporation (COST): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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