Wolfe assumes Costco at Peer Perform, says valuation remains elevated

Wolfe Research assumed coverage of Costco (COST) with a Peer Perform rating. Costco’s focus on value, volumes, and merchandising has created a strengthening flywheel, and with 90%+ renewal rates, higher income consumers, and the stock lagging recently, the firm likes the setup, the analyst tells investors in a research note. The firm added that the valuation remains elevated at 50x earnings and is more expensive than many tech firms, but the comp and earnings consistency provides some downside protection.