Financial Trading Blog
Stock of the day 09/12/2014 – Costco Wholesale Corp
Costco Wholesale will be looking for this strong form to continue as it announces its Q1 2015 earnings release on Wednesday.
Costco has had an excellent 2014, and this has been reflected on the stock market. Starting the year at $117.77, share prices quickly reached their 2014 low in February, falling to $109.53. Since then, Costco’s shares have gone on a near uninterrupted upward swing, culminating in a 2014 high of $143.58 on the 1st December. Prices dropped slightly at the start of this week to $142.36, but this still represents major gains on the markets for the international wholesaler.
The company made a bold move against its rivals Walmart and Best Buy this November, by closing its doors over Thanksgiving. Whilst this may appear to be profit-suicide in a year where the bigger stores were open Thanksgiving afternoon, Costco still managed to post a massive 7% sales growth in November in its US stores and a worldwide 5% growth in sales, up on the predicted 3.7%. Costco has been slowly eating into Walmart’s market share; where once such an idea was unthinkable, many analysts predict that one day in the near future Costco could overtake its mega-store forefather.
As its profit margins look set to be boosted by the continued saga of cheap oil, Costco’s revenue forecasts for the quarter are $26.9 billion, with full year fiscal 2015 revenue of $120.7 billion. This has led to 14 out of a polled 18 analysts giving Costco stocks a ‘buy’ rating, including Goldman Sachs, Citigroup and JP Morgan Chase. With strong forecast figures, and a remarkable November despite closing on a key retail day, Costco will be looking to tomorrow with a bullish sentiment in mind.
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