Costco’s (COST) shares rose about 2% on Tuesday after TD Cowen issued a bullish call on the wholesale retailer following its visit to the company’s headquarters. TD Cowen analyst Oliver Chen noted that “Costco’s biggest risk is being complacent, [but] they are not standing still.”
Claim 55% Off TipRanks
Forget margin or options. Here's how the pros trade AMZNChen reaffirmed his Buy rating on COST and set a price target of $1,175, implying about 15% upside in the months ahead. He said he met with Gary Millerchip, Costco’s executive vice president and chief financial officer, with the meeting focused on the retailer’s evolving business model, membership base, and customer engagement.
TD Cowen Hails Costco’s ‘Willingness to Experiment’
The meeting also included insight into Costco’s new store formats, innovation for how checkout is done, and efforts to boost the personalization of the customer shopping experience. It also covered how Costco is using AI to enhance its operations.
“We were most impressed by management’s willingness to experiment and innovate across the business, while remaining disciplined and anchored to Costco’s value-first operating model,” Chen noted.
Why Analysts Are Bullish on Costco
The analyst comment adds to recent bullish comments on the wholesale retailer by other analysts. For instance, Bernstein’s Zhihan Ma recently noted that Costco “has a significant growth runway of another ~50+ years.”
DA Davidson analyst Michael Baker, in his recent assessment of Costco, noted that warehouse club operators, including Costco, could collectively grow their warehouse count by 70% from current figures.
Moreover, Ma, in another rating, described flagged Costco as offering the lowest prices compared to rivals such as Walmart (WMT) and Amazon (AMZN).
Is Costco a Good Stock to Buy Now?
Across Wall Street, Costco’s shares remain a Moderate Buy based on analysts’ consensus rating. This breaks down into 15 Buys, six Holds, and one Sell issued by 22 analysts over the past three months.
In addition, the average COST price target of $1,098.44 only implies about 8% upside.
