Costco, the Consumer Cyclical sector company, was revisited by a Wall Street analyst yesterday. Analyst Steven Zaccone from Citi maintained a Hold rating on the stock and has a $1,065.00 price target.
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Steven Zaccone has given his Hold rating due to a combination of factors influencing Costco’s recent performance. The company’s same-store sales (SSS) for June showed a slight improvement over May, with a 6.2% increase excluding gas price deflation and foreign exchange impacts. However, the growth in traffic was relatively stable, suggesting no significant acceleration in customer visits. Additionally, while some categories like fresh foods and non-food items performed well, others such as food and sundries showed deceleration, indicating mixed results across different segments.
Moreover, macroeconomic factors, including weaker retail traffic trends and potential spending shifts due to tariffs, might have contributed to the softer traffic growth observed in recent months. The impact of extended hours for Executive members is still uncertain, and cannibalization remains a concern, affecting international sales results. Overall, while Costco’s performance remains solid, these mixed signals and external factors justify a cautious Hold rating from Zaccone.
In another report released today, Roth MKM also reiterated a Hold rating on the stock with a $907.00 price target.
COST’s price has also changed slightly for the past six months – from $927.370 to $982.090, which is a 5.90% increase.