Citi Raises Costco Price Target to $1,000 as Sales Top $123 Billion
Costco shares fell 4% over the past year despite generating $123 billion in sales in the first 22 weeks of its fiscal year and January comp sales rising 7.1% on $21.3 billion revenue. Citi lifted its price target to $1,000 from $990 and maintained a neutral rating after these results.
1. Sales Results and Comparable Growth
In the first 22 weeks of its fiscal year, Costco reported $123 billion in total sales. January alone saw $21.3 billion in revenue, with comparable sales up 7.1%, underscoring continued consumer demand and pricing power.
2. Annual Share Performance
Despite robust sales growth, Costco’s share price has declined 4% over the past year. This underperformance reflects broader market volatility and valuation reassessments within the retail sector.
3. Citi’s Rating and Price Target Adjustment
Citi retained its neutral rating on Costco shares while raising its 12-month price target to $1,000 from $990. The modest target increase reflects confidence in sales momentum balanced against near-term margin pressures.
4. Cramer’s Valuation Commentary
Jim Cramer highlighted Costco’s historical valuation, noting that the stock stalled above 50 times earnings during its last major peak. He contrasted this with Walmart’s multiple, suggesting Costco’s scale and growth justify its premium multiple over competitors.