Summer Sale
50% off Premium Yearly
Opinions Stockchase Insights
Costco Wholesale CorporationCOSTBUY ON WEAKNESSMay 29, 2023
Stockchase InsightsStock price when the opinion was issued
As of Jun 18, 2026. Market Open.
You might be interested:
High valuation but is growing double digits, which it should do so for years. They have the lowest prices of products compared to peers. A lot of room to expand location. A great business model. He will hold this forever.
Barry Schwartz
A buy-and-hold forever. Omnichannel retailer, as it's increasingly seeing acceleration in e-commerce and delivery channels.
Brian MaddenHe wrote an in-the-money call at $985. It was trading over $1,000 yesterday down to $950 today. He covered half the position and just closed it out at $5. He netted a $22 profit. Earnings were good, as expected. You can add to it at these levels, despite the high PE.
Kevin Simpson
Both great companies, but both very expensive. COST is over 50x PE, and WMT's in the 40s. Fairly low-margin model. Reliant on the consumer, and everyone's affected when that consumer is struggling.
WMT reported today. Earnings were OK, but projections on future quarters were tough. High fuel prices were highlighted.
No valuation concerns, as it's been expensive every day he's looked at it over 30 years. Compounded shareholder total return of 17.5% since its IPO. Third-largest retailer in the world. Procurement clout and supply-chain efficiencies produce gross margins of 11%. Still expanding store count. Periodically increases membership fees. Superior same-store sales performance driven by traffic and basket size.
Lots of ways to win. Yield is 0.59%.
Brian MaddenThe only consumer staples he owns are COST and KO, which are still growing.
Barry Schwartz
A good name to hold in consumer staples when people panic about market volatility, recession, or the like. Defensive plus steady growth. Runup since January, now trending sideways. Business model is what makes it stand out.
Sees ~11-12% upside from here. Of course, that could change. Ranks 10/10 for her.
Brianne Gardner
EPS of $3.42 beat estimates of $3.28. Sales of $53.6B slightly missed estimates of $54.26B. Costco's top-line growth in fiscal 4Q may be driven more by traffic as the average basket size declines, though same-store sales excluding fuel and foreign exchange face tough comparisons. Food and sundries are categories of strength. Management expects inflation to moderate in 4Q, though lower demand for big-ticket items like furniture and electronics remains a headwind that will persist. The company discontinued its charter shipping activities in 3Q, resulting in a non-recurring charge that's weighing on profit. Core merchandise margin may be pressured in fiscal 4Q from higher costs and lower sales of higher-margin discretionary items. Investors liked the results, and the stock remains one that could still do well in a recessionary environment. Valuation is certainly up there at 35X earnings, but it has never been a cheap stock.
Unlock Premium - Try 5i Free