Issaquah, Washington-based Costco Wholesale Corporation (COST) operates a chain of membership-only big-box warehouse club retail stores. With a market cap of $393 billion, Costco operates through its outlets spread across North America, Asia, and Europe and an e-commerce website. The discount stores giant is expected to release its Q1 earnings for 2025 on Thursday, Dec. 12.
Ahead of the event, analysts expect Costco to report a profit of $3.78 per share, up 8.6% from $3.48 per share reported in the year-ago quarter. The company has consistently surpassed Wall Street’s earnings estimates over the past four quarters. Its adjusted EPS for the last reported quarter grew 6% year-over-year to $5.15 exceeding the consensus estimates by 2%.
For fiscal 2025, analysts expect Costco to report an adjusted EPS of $17.75, up 10.2% from $16.11 in fiscal 2024. In fiscal 2026, its adjusted EPS is expected to grow 9% year-over-year to $19.35.
COST stock prices have surged 34.4% on a YTD basis, outperforming the S&P 500 Index’s ($SPX) 22.3% gains and the Consumer Staples Select Sector SPDR Fund’s (XLP) 11.6% returns during the same time frame.
Costco's stock price experienced a 1.8% decline in the trading session after the release of its fiscal 2024 earnings on Sept. 26. The company reported a 5% year-over-year increase in total revenues, amounting to $254.5 billion. This figure, however, fell slightly short of analysts' expectations, likely contributing to the dip in stock prices.
On a brighter note, Costco showcased impressive efficiency in controlling its costs leading to a remarkable 17.1% year-over-year surge in net income, reaching $7.4 billion. Moreover, its e-commerce sales, which had seen explosive growth during the COVID-19 pandemic in 2020 and 2021 but underperformed in 2022 and 2023, have rebounded. The company reported a staggering 16.2% growth in e-commerce sales on a constant currency basis compared to the fiscal 2023.
The consensus opinion on COST stock is moderately bullish, with an overall “Moderate Buy” rating. Out of the 32 analysts covering the stock, 18 recommend “Strong Buy,” three advise “Moderate Buy,” and 11 advocate a “Hold” rating. The mean price target of $950.48 suggests a potential upside of 7.2% from current price levels.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
