|Bid||248.01 x 800|
|Ask||248.03 x 1400|
|Day's Range||245.60 - 248.48|
|52 Week Range||189.51 - 248.48|
|Beta (3Y Monthly)||1.07|
|PE Ratio (TTM)||31.79|
|Earnings Date||May 30, 2019|
|Forward Dividend & Yield||2.28 (0.94%)|
|1y Target Est||245.92|
U.S. minimum wages might be the highest ever after a slew of increases by cities and states over the past several years, a prominent economist contends.
Well like Costco (COST) there are other prominent retailers that are riding on the wave of favorable consumer environment and strategic endeavors.
In response to my article about Warren Buffett (Trades, Portfolio)'s approach to balance sheet assets, a reader posed an interesting and useful question. Warning! GuruFocus has detected 7 Warning Sign with COST. The reader pointed to the experience of three retailers -- Costco (COST), Macy's (NYSE:M) and Overstock (OSTK) -- and summarized their metrics for accounts receivable, days to pay suppliers, inventories and gross margins.
We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares...
If you believe in holding shares for the long term, I'd suggest that you take a closer look at Costco (NASDAQ:COST), the second-largest global retailer by revenue. Costco stock has rewarded its shareholders well in 2019 and we can expect these rewards to continue.Source: Shutterstock Founded in Seattle in 1983, Costco has over 750 warehouses worldwide, including 527 in the U.S.As many analysts debate whether an economic slowdown is around the corner, long-term investors, who may want to recession-proof their portfolio, could regard any dip in the stock price as a viable opportunity to buy into COST shares.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Should Investors Worry About the Invested Yield Curve?I have been increasingly noticing the economically dreaded "r" word in the media. While analysts are divided as to whether many global economies including the U.S. could be headed toward a recession in the near future, investors could benefit from thinking about how to recession-proof their portfolios.Are we almost at the tail end of nearly a decade of economic growth? Although there have been a few short-lived downturns over the past 10 years, most economies have enjoyed stable growth since the recession of 2008-09.However, in March as well as earlier in December 2018, fears of a U.S. recession that could also spread to other countries hit the headlines as analysts highlighted the inverted yield curve in the U.S. This signal occurs when U.S. short-term treasury notes yield more than longer-term instruments. Many analysts warn that an inverted yield curve may be a sign of an upcoming recession. * 10 High-Yielding Dividend Stocks That Won't Wilt We will not know when the next recession has exactly started until we are in it, but generally, the economy and investors' sentiment can change rather quickly. What looks like a bull market today can become a bear market the next month.Therefore, if you are of the opinion that an economic slump may be almost upon us, you may want to reconsider your portfolio diversification strategies. Certain industries and stocks tend to do better in times of slower economic growth. Costco's Business Model Makes It a Resilient StockA defensive company usually has a constant demand for its products or services and isn't typically correlated to the rest of the business cycle. Costco operates in the warehouse club (or wholesale club) space within the retail industry. Due to the low-cost and high-value products offered by warehouse clubs, this sector usually performs well regardless of macroeconomic conditions. In this segment, Costco's main competitor is Walmart (NYSE:WMT) and both companies are thriving in this competitive environment.Costco runs on a "subscription business model," whereby customers pay an annual membership fee to have access to its bargain-priced bulk goods.Costco offers three types of membership: Executive, Business and Gold Star. In total, Costco collects over $3.1 billion in membership fee revenue, which is almost entirely profit. The membership service has a renewal rate of 90% as the group scores high on customer satisfaction surveys.By using a membership-only system, Costco is able to book nearly all of its profits one year in advance. In other words, the annual membership model contributes to its operating income and gives Costco stock immense earnings stability. Costco sells merchandise at bargain prices, across six main categories: * Foods (such as dry, packaged and groceries) * Sundries (such as snacks, beverages and cleaning supplies) * Hardlines (such as appliances, electronics and health products) * Fresh Foods (such as meat, produce, deli and bakery) * Softlines (such as apparel and small appliances) * Ancillary (such as gas stations and pharmacy)These ancillary businesses provide a range of products and services that aim to encourage members to visit Costco stores more frequently. Coupled with strong customer loyalty, the retail giant has pricing power, too.In other words, the membership structure has become a source of much of Costco's competitive advantage. Price-sensitive members are visiting the store regularly. No matter how the economic climate changes over the years, the retailer is likely to put up steady growth. COST Stock Has Robust FundamentalsIn 2018, Costco's comparable sales adjusted for fuel prices and currency rose 7% and total sales reached $138.4 billion. On March 7, the retail giant announced revenues of $35.4 billion, thanks to the growth in membership fees. For fiscal Q2, Costco reported earnings per share of $2.01, 31 cents ahead of expectations. In 2019, analysts now expect the warehouse chain to earn $7.92 per share, up 11.7% from last year, buoyed by new store openings and strong same-store sales growth. Wall Street is also applauding its low-cost structure, one of the lowest in the retail industry.Furthermore, the company has a burgeoning e-commerce operation. E-commerce comparable sales (comps) jumped almost 26% year-over-year (YoY). Its online and same-day delivery show strong growth and is likely to add to Costco's bottom line for years to come.In short, investors have been approving of the steps, including customer and employee satisfaction, favorable job scene and opening of new warehouses globally, that Costco's management has been taking over the years -- factors that are likely to translate into a strong balance sheet in the rest of the decade.Asia, including Japan, Korea and Taiwan, is a key market for Costco. The company sees increasing membership signups on the opening day of Asian stores. It is also about to open up its first store in China. The opening of new warehouses in Asia could accelerate the company's current growth rate. What Could Derail Costco Stock?Year-to-date, COST stock is up 21%. So, in the next few weeks, there might be some profit taking in the stock. As a result of the recent impressive run-up in the price, short-term technical indicators have become somewhat over-extended. Investors who pay attention to short-term oscillators should note that Costco's technical message has also become "overbought." In the next few weeks, COST stock could trade sideways for several weeks, and even have a pullback toward the low-$230's or even mid-$220's level, where the stock is likely to find major support. However, if the stock price were to go below $225, there could be further profit taking and the stock could go down to low $200's.COST stock's beta is 0.96, which means its volatility on average mimics that of the broader market. Therefore if the industry or the broader market declines as other companies, especially competitors, release earnings, the Costco stock price may also be adversely affected. In other words, investors should watch for market corrections. * 7 Small-Cap Growth ETFs For Adventurous Investors If you already own Costco stock, you might want to hold your position. That said, if you are worried about short-term profit taking, then within the parameters of your portfolio allocation and risk/return profile, you may consider placing a stop loss at about 3-5% below the current price point, to protect your profits to-date. The Bottom Line on COST StockQ2 may bring further volatility to the stock market, and I would not advocate bottom picking; however, I'd regard any price dip in COST stock as a buying opportunity for long-term shareholders. Due to its membership-only system, Costco is a unique warehouse stock with attractive high margins and downside earnings risk. I believe Costco will continue its long track record of strong performance and by the end of 2020, I'd expect the shares to reach $275. Finally, investors who buy into the COST stock price can enjoy a dividend yield of 0.93%.As of this writing, Tezcan Gecgil did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 High-Yielding Dividend Stocks That Won't Wilt * 4 Energy Stocks Soaring as Trump Tightens on Iran * 7 Tech Stocks With Too Much Risk, Not Enough Upside Compare Brokers The post Why Costco Stock's Growth Will Keep Climbing Higher appeared first on InvestorPlace.
In fact, these factors collectively have aided Costco (COST) in sustaining impressive comparable sales run. The company is committed toward ramping up investments in the wake of rising competition.
Dalio’s Bridgewater Warns about Peak Margins—Should You Care?(Continued from Prior Part)A turning point for corporate margins? In its research, Bridgewater Associates has presented several arguments to support its view that current US corporate
Market forces are taking America cashless but local politicos, like the luddites destroying machines that replaced craftsmen, are throwing up roadblocks.
Other retailers must find different ways to drive consumers to their businesses. We see those that focus on healthy foods, locally grown or made products, specialty niche stores, those that only carry high-end brands, those that only carry low-end brands, and in the case of Costco Wholesale Corp. (COST) and Walmart unit Sam’s Club, those that only sell in bulk. Costco is considered the original bulk retailer.
What’s Driving Target’s Impressive Stock Performance in 2019?(Continued from Prior Part)Margin headwinds could limit upsideWe believe Target’s (TGT) digital initiatives, including its expansion of online order fulfillments, coupled with its
What’s Driving Target’s Impressive Stock Performance in 2019?Growth driversShares of Target Corporation (TGT) have generated better returns than both Costco (COST) and Walmart (WMT) so far this year. Target stock is up 25.1% on a YTD
Walmart's (NYSE:WMT) move into the online space continues. Its latest partnership includes an alliance with Kidbox. Kidbox's assortments will bring many upscale clothing brands into Walmart and expand its omnichannel presence. Walmart stock rose slightly higher on the news.Source: Shutterstock Still, investors should take a closer look at how much this will affect WMT stock. Even with the increase in online and upscale options, many of the same problems that have overshadowed the company remain.Once investors take a closer look at WMT overall, they will likely find that Walmart stock already prices in any boost the equity has received from its online and tech-related improvements.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Stocks to Buy for Spring Season Growth Walmart Quality ImprovesUnder terms of the agreement, Walmart and Kidbox will provide personal, stylized boxes. Each box will cost $48 and deliver four or five items chosen from more than 120 premium brands. This should make Walmart more active in the children's clothing business and will provide a way for parents to benefit from more exclusive brands at a lower cost.Walmart had long struggled with a reputation for selling more downscale items. The Kidbox partnership along with its Jetblack, its members-only personal shopping service, should help change this perception.Moreover, it has stepped up its competition with Amazon (NASDAQ:AMZN). Not only has Walmart expanded its online presence, but it has also begun to build an online-ad business on its ecommerce site. This has helped take the forward price-to-earnings (PE) ratio on Walmart stock to about 20.7. Has Walmart Changed?Still, investors have to wonder how much trying to beat Amazon at its own game will help Walmart. Yes, ecommerce sales for Walmart increased by 40% in 2018. However, omnichannel peers such as Target (NYSE:TGT) and Costco (NASDAQ:COST) have also seen massive online sales growth.Moreover, WMT management also mentions the word "eCommerce" 125 times in the 2018 annual report. Yet for all of this focus, they did not disclose a specific ecommerce revenue figure. One analyst estimated $20.91 billion in U.S. ecommerce sales. Whether or not that is exact, it shows that online sales still constitute a small fraction of the $514.4 billion of Walmart's revenue in the previous fiscal year.WMT has made strides with online and upscale product lines, and this has boosted Walmart stock. However, in other areas, Walmart remains little-changed. While ecommerce registered high-growth, revenues rose by only 2.8% in fiscal 2019. Hence, for all of the focus on online sales, most revenue still comes from its traditional stores. Overriding ConcernsMoreover, many of the complaints that dogged Walmart for decades remain. The company has begun to deploy robots to clean floors and scan shelves. This brings the focus back to working conditions at Walmart stores. It has also drawn the ire of labor advocates who believe this will destroy jobs.Furthermore, Walmart store expansion has slowed to almost a standstill. The company operates 11,766 stores worldwide, up from only 11,718 locations in 2018. This low growth level may make sense in the saturated U.S. market. However, it also speaks to the failure to export its retail strategy outside of North America.Holders of Walmart stock had held out hope for offshore successes in ecommerce. Walmart purchased Indian ecommerce company Flipkart last summer in hopes of a success overseas. However, changing government policies may have effectively dismantled that business. As a result, many have floated rumors of a market exit. The Bottom Line on Walmart stockThe Kidbox alliance could give a short-term boost to Walmart stock, but most of the company's long-time problems remain. Partnering with Kidbox stands as the latest step WMT has made in improving product quality. Moreover, its online venture and move into online ads show that Walmart can compete with Amazon.However, below the surface the Walmart known for labor issues and failure outside of North America intact. Store growth has come to a standstill, and the Flipkart venture appears headed for failure.Despite the optimism surrounding Kidbox, Walmart will probably see little long-term growth until it can succeed internationally.As of this writing, Will Healy did not hold a position in any of the aforementioned stocks. You can follow Will on Twitter at @HealyWriting. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Stocks to Buy for Spring Season Growth * This Is How You Beat Back a Bear Market * 7 Dental Stocks to Buy That Will Make You Smile Compare Brokers The post Kidbox Could Boost Revenue, but It Can't Bolster Walmart Stock appeared first on InvestorPlace.
The retailer has climbed more than 20% in 2019, and is up 25.5% in the past 12 months. The shares have been largely untouched by the woes of the broad sector.
That said, let's check out the probability of four discount retailers to beat earnings estimates this this reporting cycle.
Most shoppers know that buying in bulk can net you some serious savings, which is one of the many reasons Costco is one of America's favorite places to shop. Costco launched its home-delivery option in 2017. To determine which store generally has the lowest prices for bulk items ordered online, CNBC Make It compared two-day shipping prices listed online from Boxed and Costco on a range of everyday items for delivery in New York City.
Office Depot's (ODP) cautionary statement on lower-than-expected operating performance at the CompuCom division was enough to push the stock into the bearish territory.
It seems overly anxious to argue that American Express (NYSE:AXP) stock needs big first-quarter results. After all, American Express stock is doing just fine, even if it's been quiet.Source: Shutterstock AXP stock did dip sharply in December, but it's recovered those losses. Over the last year, American Express stock has gained nearly 17%, and it has more than doubled in the last three-plus years. * 7 Dental Stocks to Buy That Will Make You Smile Still, AXP earnings, due to be reported on Thursday morning, do look reasonably important. The outlook of AXP stock still seems somewhat skeptical, if not outright bearish. Investors are worried about its growth and market share. Its Q4 earnings were disappointing, but the market quickly moved on and kept pushing American Express stock higher. Investors may not be so forgiving if AXP earnings are disappointing again on Thursday.InvestorPlace - Stock Market News, Stock Advice & Trading TipsAXP stock has twice failed to break through resistance at about $113, and the average Street price target for American Express stock of $118 suggests an increase of just 6% from its current level.A "beat and raise" Q1 would likely cause analysts to raise their price targets on AXP stock, leaving AXP well-positioned to reach new highs. If AXP earnings miss expectations, however, investors may have concerns about AXP's growth, causing American Express stock to at best trade sideways, as it has for nearly seven months now.As a result, Thursday's earnings do seem to be important for American Express stock, and investors should review them closely. Expectations for AXP EarningsWall Street is expecting a moderately slow start to the year for American Express. Analysts' consensus revenue estimate projects just 7.6% year-over-year, top-line growth, below the company's full-year guidance of 8%-10%. The company's margins are expected to be pretty much flat, and analysts on average expect its earnings per share to come in at $1.98, up 6.5% year-over-year.That, too suggests improvement over the rest of the year. Consensus for 2019 as a whole is modestly above the midpoint of the company's guidance, and projects 11% EPS growth.That's good news for AXP stock. AXP is not exactly in a "no-lose" situation, but analysts already expect its growth to accelerate as the year goes on. An in-line quarter, or even a modest miss, won't necessarily endanger that outlook.On the other hand, if AXP results solidly beat expectations, its outlook may get more interesting. Under that scenario, American Express will have started the year strongly, and will still have the same room for improvement during the rest of the year. Full-year growth estimates may well get raised, and the earnings multiple assigned to American Express stock can also rise. If that occurs, AXP can reach new highs. AXP Stock and the Post-Earnings CallThat said, the numbers aren't going to be the only aspect of the release to which investors will pay close attention. American Express re-upped its partnership with Delta Air Lines (NYSE:DAL) earlier this month. That was a big win for AmEx, which already had lost co-branding agreements with Costco Wholesale (NASDAQ:COST) and JetBlue Airways (NASDAQ:JBLU).But American Express had to pay up for the win. It was Delta stock that soared on the news, given that its payments from the deal will double in five years. The end results of that negotiation certainly suggests that American Express' edge over rivals Visa (NYSE:V) and Mastercard (NYSE:MA) has narrowed.So investors will have concerns about AXP's cost and market share Visa and Mastercard simply are growing faster than AmEx. And the main concern about American Express - and the reason AXP stock is so much cheaper than V and MA - is that at some point, its earnings simply are going to stall out. The entrance of Apple (NASDAQ:AAPL) into the space only adds to those worries.There likely will be some questions about the Delta deal and the kind of returns American Express expects on the resulting $3 billion-plus increase in annual spending. Analysts will want management's take on the Apple Card as well. AmEx needs to answer those questions well, and it needs to convince analysts and investors that its place in the credit-card industry is secure. Be Careful With American Express StockAll told, AXP's Q1 results do seem poised to change the outlook of AXP stock. A beat-and-raise quarter will suggest that AXP's growth remains intact, making the 12.4 forward, price-earnings multiple of AXP stock seem awfully cheap. Any weakness - whether in the company's results or its guidance - will cause investors to ask if fears about AXP's growth are reasonable.That doesn't mean AXP stock is going to move 10% or more on Thursday; AXP simply isn't that type of stock. Rather, AXP's Q1 earnings could shape how American Express stock trades over the next two months and determine whether AXP stock can finally break through resistance.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Internet Stocks to Watch * 7 AI Stocks to Watch with Strong Long-Term Narratives * 10 Dow Jones Stocks Holding the Blue Chip Index Back Compare Brokers The post AXP Earnings Look Key for American Express Stock appeared first on InvestorPlace.
Yahoo Finance's Adam Shapiro and Julie Hyman join Chief Investment Officer Albion Management Group Jason Ware to discuss Disney's stock after their streaming service launch.