U.S.-based membership-only retail chain Costco (COST) shareholders voted against the call to review its DEI (diversity, equity, and inclusion) initiatives. Costco stated that 98% of shareholders rejected the proposal during the annual meeting, which called for a report analyzing the risks of continuing the company’s diversity initiatives.
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Trump Moves to Dismantle DEI Initiatives
DEI initiatives are losing support and facing increasing legal challenges as President Trump returns to the White House. Recently, Trump signed an executive order to dismantle DEI policies within the federal government.
Interestingly, tech giant Meta Platform (META) decided to terminate its workplace diversity programs, ahead of Trump’s inauguration on January 20. Similarly, Amazon (AMZN) also announced it would make changes to its DEI programs amid growing opposition.
In contrast, Apple (AAPL) urged its shareholders to vote against a proposal aimed at terminating its DEI programs.
Costco Stands Firm amid DEI Backlash
Costco is standing firm amid the rising DEI backlash in the market. Earlier this month, Costco refused to follow the trend of companies reducing DEI initiatives, despite mounting pressure from conservative activists. The company also firmly defended its dedication to DEI programs.
On the other hand, the National Center for Public Policy Research (NCPPR), a conservative activist group behind the proposal, argued that DEI initiatives are unlawful, unethical, and harmful to shareholder value. The group further claimed that such programs expose the company to potential legal challenges.
Is Costco a Good Stock to Buy Now?
As per the consensus rating on TipRanks, COST stock has a Moderate Buy rating, supported by a total of 24 recommendations, including 16 Buys and eight Holds. The Costco share price forecast is $1,058.58, which is 12.36% above the current price level.
Year-to-date, COST stock has gained nearly 3%.
