Does Costco Wholesale Corporation (COST) Have A Risk Factor?

The stock of Costco Wholesale Corporation (NASDAQ:COST) increased by $0.07 on Wednesday to $463.18, up 0.02 percent. The last five days have seen an average of 2,358,756 shares of common stock traded. 7 times new highs were reached in the current year, with a fall of -$104.65. The average number of shares traded over the last 20 days was 3,104,394, while the average volume over the last 50 days totaled 3,064,042.

COST stock appreciated 9.50% since last month. On 05/23/22, the company’s shares reached a one-month low of $416.67. The stock touched a high of $612.27 on 04/07/22, after rallying from a low of $386.56 in 52 weeks. The price of COST stock has declined by -18.42% or -$104.65 this year, reaching a new high 7 times. Still, the stock price is down -24.35% from the 52-week high.


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Insider Transactions

There have been 15 days since Costco Wholesale Corporation (COST) last reported insider trading activity on Jun 07. On Jun 07, Director Wilderotter Mary Agnes acquired 850 shares at $470.74 each. This transaction resulted in the insider spending $400,125. On Apr 08, Hines Daniel M. sold 4,498 shares at a price of US$603.00. After the transaction, the insider now owns 13,108 shares. Executive Vice President Adamo Claudine had earlier sold 500 shares on Apr 08 for $602.03 a share. The transaction was completed for $301,015.

Valuation Metrics

Costco Wholesale Corporation (COST) has a trailing price-to-earnings (P/E) ratio of 36.47. Beta for the stock is 0.68. There are also a few other valuation ratios worth considering, including the trailing price-to-sales (P/S) ratio of 0.95, the price-to-book (PB) ratio of 10.29, and the price-to-cash flow ratio of 76.81.

Company paid $0.90 per share in dividends, an increase of 13.92% from $0.79 last year. A $0.11 dividend increase was reported on Wednesday April 13 2022.

Financial Health

For the three months ended February 27, Costco Wholesale Corporation’s quick ratio was 0.50, while its current ratio was 1.00, indicating its inability to pay off its debt. The company’s long-term debt to equity ratio for the quarter ending February 27 is 0.33, and the total debt to equity ratio is 0.33. As far as profitability goes, gross margin for the trailing twelve months is 12.40% percent. Costco Wholesale Corporation’s EBITDA margin for the year ended February 27 was 4.78%, whereas its operating margin stood at 3.50% for the same period. Based on annual data, it had gross profit of $25.25 billion and revenue of $195.93 billion.

Investors will also look at the performance of the company’s management in order to determine the potential profitability of their investment. COST’s return on assets (ROA) during the last 12 months has been 9.00%. There was a 19.60% return on investment (ROI) in the past year. In the meantime, the return on equity (ROE) for the last 12 months was 29.90%.

Earnings Surprise

According to Costco Wholesale Corporation’s quarterly financial report for the quarter that ended February 27, it had $6.51 billion in total debt versus $638.0 million in cash and short-term investments. A higher net income was reported in the quarter under review than the previous quarter. Net income for the quarter came in at $52.6 billion, while revenues rose by 13.92% to $51.9 billion. It was predicted that Costco Wholesale Corporation’s quarterly earnings would be $2.92, but it ended up being $2.74, beating the consensus by 6.60%. EBITDA was $2.23 billion for the quarter. At the end of Costco Wholesale Corporation’s most recent quarter ended February 27, its liabilities totaled 43.34 billion, while its total debt was $9.25 billion. Equity owned by shareholders amounts to $442.96 million.

Technical Picture

Here’s a quick look at Costco Wholesale Corporation’s (COST) price momentum from a technical perspective. As of 21 June, the RSI 9-day stood at 50.20%, suggesting the stock is Neutral, with a 27.97% historical volatility rate.

The stochastic %K and %D were 30.08% and 18.85% respectively, while the average true range (ATR) was 13.85. Based on the 14-day stochastic reading of 41.41%, the RSI (14) reading is 46.51%. On the 9-day MACD Oscillator, the stock is at -0.81, and the 14-day reading is at -6.81.

Analyst Ratings

In a note to investors, Truist maintained its a Buy rating on Costco Wholesale Corporation (NASDAQ: COST). However, the firm raised their price target to $603, indicating a possible increase of 23.57% in the stock price.

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