Costco Wholesale (COST) reported a net sales increase of 8.7% in August to $21.56 billion, driven by strong e-commerce demand. For fiscal Q4, it reported net sales of $84.4 billion, up 8%. Despite this positive sales report, Truist Securities analyst Scot Ciccarelli maintained a Hold rating on COST stock, citing valuation concerns.
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Closer Look at Costco’s August Sales Report
In August, comparable sales rose 6.3% company-wide. After excluding fuel and foreign exchange impacts, Costco’s total comparable sales were even stronger at 6.9%. Sales grew steadily across regions, rising 6.7% in the U.S., 9.4% in Canada, and 5.3% in international markets.
Full-year net sales reached $269.9 billion, an 8.1% increase year-over-year. The upside was due to steady demand across groceries, household items, fresh food, and other products.
Costco’s digital channels continued to shine. E-commerce sales jumped 18.3% in August. For the full year, online sales rose 16.1%, signaling strong demand for Costco’s online offerings.
Truist Analyst Raises Valuation Concerns
Despite the upbeat numbers, Ciccarelli reiterated a Hold rating and maintained his $1,042 price target on COST stock. He acknowledged the continued strength in Costco’s core business, citing the company’s ability to attract a wide customer base with competitive pricing and consistent value.
However, the five-star analyst cited valuation concerns, noting that the stock is trading at roughly 50 times projected 2025 earnings.
Ciccarelli said, “we stay on the sidelines as we look for a more attractive price-point for entry.”
What Is the Prediction for Costco Stock?
Turning to Wall Street, COST stock has a Moderate Buy consensus rating based on 11 Buys and eight Holds assigned in the last three months. At $1,088.31, the average Costco stock price target implies 12.96% upside potential.
