Retail powerhouse Costco (COST) is set to release its fourth quarter of Fiscal 2024 financials on September 26. Wall Street analysts expect the company to report earnings of $5.08 per share for Q4, up 4.5% year-over-year. Also, analysts expect revenues to increase 1.2% from the year-ago figure to $79.91 billion, according to TipRanks’ data.
Factors to Consider Ahead of Q4
Analysts forecast both revenues and earnings to increase in fiscal Q4, signaling optimism for Costco’s near-term performance.
In addition, analysts, according to TipRanks’ Bulls Say, Bears Say tool shown below, believe Costco is gaining strong consumer traction despite a challenging spending environment. They also highlight that the company’s untapped potential in digital media offers an additional revenue stream that hasn’t been fully recognized by the market. Moreover, future revenue growth is expected to be driven by new warehouse productivity and continued market share gains.
Nevertheless, a few challenges remain. Bears have pointed out that Costco’s current valuation makes it hard to see a significant upside, given its long-term earnings growth rate. They also note that recent financial performance faced slight negative impacts from gas prices and foreign exchange.
Options Traders Anticipate a Large Move
Using TipRanks’ Options tool, we can gauge options traders’ expectations for the stock post-earnings report. Based on an $890 strike price, with call options priced at $24.44 and put options at $12.51, the expected price movement, based on the at-the-money straddle is 4.08%.
Is Costco Stock a Buy or Sell?
Turning to Wall Street, Costco has a Moderate Buy consensus rating based on 16 Buys and seven Holds assigned in the last three months. At $933.24, the average COST price target implies a 3.52% upside potential.
