Costco

• Revenue Growth: Costco reported $58.52 billion in revenue for Q3 2024, representing a 9.1% YoY increase. This growth reflects continued strong performance in its core retail operations and membership sales.

• Net Income: The company achieved an EPS of $3.78 for Q3 2024, surpassing analyst expectations of $3.70, underscoring its consistent profitability and effective cost management.

• Free Cash Flow: Costco continues to generate strong free cash flow, supporting its ability to pay dividends and invest in new store openings and expansions.

💰 Valuation Analysis

• P/E Ratio: Costco’s current P/E ratio is 54.9x, reflecting a premium valuation typical for a company with a strong brand, steady earnings growth, and a robust membership model.

• Price Target: Analysts have set a consensus price target of $819.89, indicating a potential downside of approximately 7.6% from the current price. However, some analysts have higher targets, reflecting optimism about Costco’s long-term growth prospects.

• Market Cap: Approximately $393 billion, positioning Costco as one of the largest and most stable retail companies globally.

📈 Growth Metrics

• 2025 EPS Growth Forecast: Analysts expect EPS to grow by 10.26% in 2025, driven by continued expansion of Costco’s membership base and its strategic focus on efficiency and value for customers.

• Price Target: The wide range of price targets reflects differing views on Costco’s ability to maintain its current growth trajectory amidst economic uncertainties.

🔮 Forecast

Final Summary

• 🚀 Stable Growth: Costco’s reliable earnings, strong membership model, and strategic expansions make it a solid choice for defensive investors.

• 📉 Valuation Considerations: While Costco’s valuation is high, its consistent performance justifies the premium, though investors should be aware of potential risks.

• 🔎 Mixed Analyst Sentiment: While most analysts recommend a "Buy," the potential downside in the price target suggests caution, particularly given the stock's high valuation.