Costco stuns again with comparable sales beat, fee hike and special dividend next?
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Costco Wholesale Corporation (NASDAQ:COST) tracked slightly higher in premarket trading on Thursday after blasting past estimates with a 17.2% increase in comparable sales in March vs. 11.2% consensus and 12.7% gain in the U.S. vs. 9.2% consensus.
Impressively, Costco (COST) realized a 34% jump in comparable sales on a three-year comparison to mark an acceleration from the February 3-year comparison against the pre-pandemic period.
Evercore ISI weighed in on Costco (COST) following the update, saying the retail stock remains a core holding amidst an inflationary retail landscape. "Rising renewal rates and lagged inflationary pass-through are positive indicators of a future fee increase," noted analyst Greg Melich. A potential special dividend is seen as providing a second catalyst.
Evercore ISI kept an Outperform rating on Costco (COST) and lifted its price target to $610. Elsewhere on Wall Street, Truist Securities raised its price target on COST to $634 from $603.
Shares of Costco (COST) rose 0.68% premarket to $588.75 to top the prior 52-week high of $586.80.