Costco Wholesale’s (COST) Teamsters union members have voted for a nationwide strike if the retailer fails to reach a fair Master contract agreement by January 18. About 18,000 Costco workers, who form a part of the International Brotherhood of Teamsters, have voted by an 85% margin to authorize a strike.
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Union Fights Costco for a Fair Labor Agreement
The two parties have been at odds to reach a fair labor agreement constituting better wages and benefits. The prior Master agreement is set to expire at the month-end. The union alleges that Costco has failed to bargain constructively to reach an agreement that aligns with the retailer’s ballooning profits. The union has been very explicit in saying that the workers will not work even one day after the prior agreement expires.
Costco’s union members even practiced picket lines last week at certain locations. For instance, hundreds of Costco workers held picket lines in Hayward, California and Summer, Washington, as well as on Long Island and San Diego. The workers believe they need to be paid fairly in accordance with their hard work, as the company’s performance is directly dependent on them.
Insights from TipRanks’ Bulls Say, Bears Say Tool
According to TipRanks’ Bulls Say, Bears Say tool, analysts and investors remain split about their views on Costco Wholesale. The bulls are encouraged by growing memberships and footfall, double-digit growth in some of the e-commerce shipments, and an expected boost in revenue and earnings.
On the other hand, some bears are concerned about the drag on Costco’s business from the shift in Cyber Week, lower membership renewal rates owing to higher digital sign-ups, and the expensive valuation of COST stock.
Is COST a Buy or Sell Stock?
Analysts remain divided on Costco stock owing to the reasons discussed above. On TipRanks, COST stock has a Moderate Buy consensus rating based on 16 Buys versus eight Hold ratings. Also, the average Costco Wholesale price target of $1,058.58 implies 12.2% upside potential from current levels. Meanwhile, COST shares have gained nearly 37% in the past year.
