Piper Jaffray Maintains Rating on Costco (COST)

Piper Jaffray Maintains Rating on Costco (COST)


Piper Jaffray & Co. reported on Monday that they have maintained their rating on discount retailer, Costco Wholesale Corporation(COST).

The firm announced that they have reaffirmed their “Overweight” rating and $110 price target for COST. This price target suggests a 10.8% increase from the stock’s current price of $98.03.

An analyst from the firm commented, “we are estimating a December reported comp between 4%-6%, which is slightly below consensus of 5.8% at the mid-point. We are also assuming a core merchandise comp of 4%-6% given the reported number will be positively impacted by F/X and higher year-over-year gasoline prices, but largely offset by cannibalization. The mid-point of our core merchandise comp is relatively in line with consensus of 5.3%. We would note that we do have a bias to the upper end of our comp range. Overall, we continue to recommend shares of COST as we believe its consistent comp trends and structural pricing advantage positions the company well to outperform in a largely unknown retail/consumer macro environment.”

Costco shares were up 92 cents, or 0.95% during Monday afternoon trading. The stock is up 14.5%.

The Bottom Line
Shares of Costco (COST) have a 1.13% dividend yield, based on the latest intraday stock price of $97.60. The stock has technical support in the $92 price area. If the stock can firm up, we see overhead resistance around the $100-$102 price levels.

Costco Wholesale Corporation(COST) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.