Analyst Simeon Gutman of Morgan Stanley maintained a Buy rating on Costco, reducing the price target to $1,130.00.
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Simeon Gutman has given his Buy rating due to a combination of factors that highlight Costco’s strong performance and strategic advantages. The company continues to demonstrate consistent execution, leveraging its scale and global supply chain to capture market share in the grocery and general merchandise sectors. Despite a slight deceleration in comparable sales, Costco’s momentum remains robust, with eCommerce sales showing significant growth.
Costco’s gross margin aligns with expectations, benefiting from supply chain efficiencies and increased private label penetration. While there was a minor decline in renewal rates, the overall membership growth remains strong, driven by tier upgrades and a growing member base. These factors, coupled with Costco’s ability to maintain core profitability and capitalize on its structural advantages, underpin Gutman’s positive outlook and Buy rating.
In another report released today, J.P. Morgan also maintained a Buy rating on the stock with a $1,050.00 price target.