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Costco (COST) Beats Stock Market Upswing: What Investors Need to Know

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Costco (COST - Free Report) ended the recent trading session at $569.82, demonstrating a +1.59% swing from the preceding day's closing price. This change outpaced the S&P 500's 0.18% gain on the day. Elsewhere, the Dow saw an upswing of 0.1%, while the tech-heavy Nasdaq appreciated by 0.3%.

Coming into today, shares of the warehouse club operator had gained 0.6% in the past month. In that same time, the Retail-Wholesale sector gained 5.64%, while the S&P 500 gained 3.08%.

The investment community will be closely monitoring the performance of Costco in its forthcoming earnings report. The company is scheduled to release its earnings on December 14, 2023. The company's earnings per share (EPS) are projected to be $3.43, reflecting a 10.65% increase from the same quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $57.69 billion, up 5.98% from the prior-year quarter.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $15.71 per share and a revenue of $252.72 billion, signifying shifts of +6.94% and +4.31%, respectively, from the last year.

Investors should also pay attention to any latest changes in analyst estimates for Costco. Such recent modifications usually signify the changing landscape of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.08% higher. As of now, Costco holds a Zacks Rank of #2 (Buy).

Looking at its valuation, Costco is holding a Forward P/E ratio of 35.71. This expresses a premium compared to the average Forward P/E of 23.05 of its industry.

One should further note that COST currently holds a PEG ratio of 4.18. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As the market closed yesterday, the Retail - Discount Stores industry was having an average PEG ratio of 2.17.

The Retail - Discount Stores industry is part of the Retail-Wholesale sector. This industry, currently bearing a Zacks Industry Rank of 92, finds itself in the top 37% echelons of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.


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