Costco December sales data saw traffic remain firm, says Baird

Baird keeps an Outperform rating and $700 price target on Costco after its December sales data. Core comps of 5.1% improved from November’s 4.4% even as comparisons steepened, traffic remained firm, and core average ticket flipped positive for the first time in nearly a year, the analyst tells investors in a research note. While the stock’s premium valuation argues for an opportunistic approach to accumulation, Costco’s defensive growth profile holds appeal in what is likely a decelerating retail backdrop this year, the firm added.