Costco Wholesale has adopted Direct Registration, a book-entry form of stock ownership. When you purchase Costco Common Stock through the direct stock purchase plan, a stock certificate will not be issued, unless specifically requested.
Costco stock last closed at $490.87, up 0.84% from the previous day, and has decreased 13.88% in one year. It has underperformed other stocks in the Discount Stores industry by 0.01 percentage points. Costco stock is currently +20.75% from its 52-week low of $406.51, and -19.83% from its 52-week high of $612.27.
Costco Warehouses is usually considered to be a blue chip company on very firm footing with huge revenues and a healthy stock price. It has a history of continued profitability along with cost control. During these inflationary times, Costco has had to pass some of the increased costs from along to its customers, but a membership renewal rate of more than 91% shows that it has appealed to customers trying to save money during this period of high inflation.
Some analysts think the company is a bit undervalued with some room to grow. As a result, Costco Warehouses has a Buy rating even at the current high share price (PE ratio of 39.75 on Oct. 26, 2022). When evaluating a stock, keep in mind that past performance does not guarantee future results.
There are two ways to invest in Costco stock. First, you can establish and fund a brokerage account and invest through either a discount or full-service brokerage. Costco recommends brokers that it prefers and considers to be high quality
Alternatively, Costco has a Direct Stock Purchase Plan (DSPP) that you can use to circumvent a brokerage service. Costco and its transfer agent, Computershare, offers this Investor Services Program to both existing Costco investors and new investors. Costco uses Direct Registration when a stock purchase is made. You will not receive a stock certificate unless you request one. For the DSPP, there are minimum investments and other online fees to consider before deciding on using the DSPP or a brokerage service.
Where the stock is traded: Costco is traded on the NASDAQ exchange, which makes it a safer bet than if it were traded over-the-counter. Stocks that trade on an exchange must fulfill certain requirements to be listed on the exchange. This makes them safer than stocks traded over-the-counter since many of those requirements do not apply to them.
Market sector: If you have other discount stores in your portfolio, you may not want to add another one. It would not provide you with diversification and the risk and return profile might be too similar. Choosing a stock from another market sector might be advisable.
Dividend reinvestment plans (DRIPs) allow investors who buy a company stock to automatically reinvest the dividends paid in fractional shares of common stock. These plans usually have low or no fees and keep investors from spending the dividends. In the case of Costco, their DRIP has a low fee after you own ninety-nine shares of stock.
If you prefer instead to trade common stock through a commission-free online broker, must use a broker with access to the NASDAQ exchange (Costco has a list of recommended brokers). But, if you prefer to get advice about your stock purchases, a full-service broker might be a better option for you. You should note, however, that there are associated costs when you use a full-service broker.
Costco allows the purchase of its common stock in fractional shares. Not all companies do, and not all brokerages trade in fractional shares, so you will have to find a broker that can do so. Costco stock is pricey and fractional shares allows new investors to enter the market at a more affordable price.
Common stock is a risky investment and you are always at risk of losing your principal. Therefore, well-established companies often make the safest investments. If you are not a financial professional, consider using a financial analyst who is skilled in evaluating and choosing stocks and developing well-diversified portfolios.
Costco is an old and established firm in the discount store space. It is one of the largest firms in the world and is the largest in terms of many of the products it carries. It is also an expensive stock. You can own more Costco stock by dollar-cost averaging. This is an investment strategy where you invest in the stock on a regular basis with the same amount of money. When the stock is trading lower, you will be able to buy more, but less when it is trading higher. Also look at the discount store sector in general. Is it doing well and what are its prospects What about an exit strategy At what price do you realistically expect to sell the stock
SmartAsset has developed a step-by-step guide for buying stock for your convenience. It will point you in the right direction and give you valuable information to use in choosing stock for your portfolio.
So you may wonder whether now is really the right time to buy shares of Costco (COST 0.07%). The warehouse retail giant has outperformed the S&P 500 this year -- but the stock still has lost about 13%. And the most recent sales report showed a slowdown. Let's take a closer look before deciding whether to go for this stock right now.
So it looks like Costco is a great stock to buy no matter what the economy is doing. But what about valuation Today, the stock is trading at 33 times forward earnings estimates. That's down from more than 45 earlier this year.
After seeing those numbers, many folks might be interested in investing in Costco. However, the company recently delivered disappointing news that must be considered before taking a position. So let's dive in and see whether Costco is a buy or if you should pass on the stock.
With the stock trading for 33 times forward earnings, it's valued about 50% higher than other retailers like Walmart and Target. When a stock is valued that much more than its peers, it must consistently beat expectations or risk being sold off. That's precisely what happened the day after the earnings report; the stock dropped about 2% although it was down over 4% during some parts of the trading session.
This could be a major catalyst for the stock, sending it higher. Or it may do nothing to the shares and decrease its valuation to be more in line with its peers. Regardless, Costco remains a solid company, even when consumers aren't willing to spend as much. For this execution, you have to pay a high multiple for the stock.
If Costco continues to post disappointing revenue numbers, the stock will likely keep slumping given it's still priced for perfection. I doubt consumers' strength will return this quarter (or the next), so it may be best to wait for Costco to reach a more attractive valuation level before purchasing the stock.
You are leaving costcobusinessdelivery.com to visit a website not hosted by Costco. Costco is not responsible for content provided by this or other third party sites, including those to which you may be redirected.
Judging by the company's performance for the past several years, Costco Wholesale (NASDAQ: COST) may look like a no-brainer stock to buy right now. When you factor in recent record Black Friday sales and a potential upcoming increase in the cost of a membership for the warehouse club retailer, it's not hard to understand why Costco stock is popular among long-term investors. The only real question for these investors is whether now is the right time to buy Costco stock.
Moreover, its loyal membership base and prospects for further expansion in the U.S. and abroad mean Costco likely maintains its growth trajectory for decades. Given that steady growth, one can understand why its stock significantly outperformed the S&P 500 over the last 10 years.
The sentiment surrounding a membership fee hike is also mere speculation at this point. Yes, an increase is possible, and the stock may surge following earnings if Costco hikes membership fees. But if it decides to keep membership costs at current levels, traders may sell the stock in the near term.
Moreover, investors should remember that stocks trade on revenue and earnings expectations, as well as forecasts for future quarters. Even if Costco gives investors a solid report, an earnings expectations disappointment remains a possibility.
Another potential pitfall involves its 39 price-to-earnings (P/E) ratio, a multiple far exceeding the S&P 500 average of 21. High P/E ratios are not unusual for Costco. Still, the valuation increases the danger the stock will sell off on bad news, a factor that adds to near-term risks.
Investors generally should consider Costco a long-term buy and when they buy in matters far less than if they buy in. The stock is likely to continue its upward trend regardless of the timing. But, given the current situation with the stock and with the economy, investors might want to hold off on adding positions until after the earnings release. Some information investors need to make an informed decision -- holiday shopping sales totals and the timing of the next membership price increase -- should gain greater clarity. Additionally, earnings reports are times when a company can release news on anything, making a stock's behavior after an announcement difficult to predict.
Costco stock is an excellent choice for its long-term investors. But to win with this retail stock, they might do better to buy based on its predictable growth rather than on the hopes surrounding one report.
10 stocks we like better than Costco WholesaleWhen our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Costco Wholesale wasn't one of them! That's right -- they think these 10 stocks are even better buys. 59ce067264