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Costco (COST) Stock Dips While Market Gains: Key Facts

In the latest trading session, Costco (COST) closed at $723.02, marking a -0.37% move from the previous day. The stock trailed the S&P 500, which registered a daily gain of 0.13%. At the same time, the Dow added 0.13%, and the tech-heavy Nasdaq lost 0.32%.

Shares of the warehouse club operator have appreciated by 5.54% over the course of the past month, outperforming the Retail-Wholesale sector's gain of 4.57% and the S&P 500's gain of 2.99%.

The investment community will be closely monitoring the performance of Costco in its forthcoming earnings report. The company is scheduled to release its earnings on March 7, 2024. In that report, analysts expect Costco to post earnings of $3.60 per share. This would mark year-over-year growth of 9.09%. In the meantime, our current consensus estimate forecasts the revenue to be $59.2 billion, indicating a 7.12% growth compared to the corresponding quarter of the prior year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $15.65 per share and revenue of $253.56 billion. These totals would mark changes of +6.54% and +4.65%, respectively, from last year.

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It is also important to note the recent changes to analyst estimates for Costco. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.41% increase. Costco is currently a Zacks Rank #2 (Buy).

Valuation is also important, so investors should note that Costco has a Forward P/E ratio of 46.38 right now. This denotes a premium relative to the industry's average Forward P/E of 22.29.

Meanwhile, COST's PEG ratio is currently 5.13. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Retail - Discount Stores industry currently had an average PEG ratio of 2.11 as of yesterday's close.

The Retail - Discount Stores industry is part of the Retail-Wholesale sector. Currently, this industry holds a Zacks Industry Rank of 84, positioning it in the top 34% of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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