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Investing.com - Mizuho (NYSE:MFG) has reiterated its Neutral rating and $975.00 price target on Costco Wholesale (NASDAQ:COST) following the retailer’s June sales report. The stock, currently trading at $982.09, has delivered an 11.63% return over the past year. According to InvestingPro analysis, the company appears to be trading above its Fair Value, with a P/E ratio of 55.3x.
Costco reported U.S. comparable sales growth of 5.5% excluding gasoline in June, matching May’s performance, according to Mizuho’s analysis of the company’s monthly sales data.
The retailer’s non-food category showed improvement, performing in the mid-to-high single-digit percentage range despite facing more difficult double-digit comparisons from the previous year that will continue through September.
International operations outperformed domestic sales with June comparable sales growth of 8.2% excluding gasoline and foreign exchange impacts, demonstrating strong momentum in Costco’s overseas business.
Mizuho noted that Costco’s current valuation appears "largely full" as the company continues to reinvest potential earnings upside into its membership model, including new store operating hours for executive members that began June 30 and additional credits for certain online orders. The company has maintained dividend payments for 22 consecutive years, showcasing its commitment to shareholder returns while investing in growth.
In other recent news, Costco Wholesale reported a robust 8% increase in net sales for June, reaching $26.44 billion, up from $24.48 billion in the same period last year. The company’s comparable sales for the month rose 5.8% overall, with a notable 6.2% increase when excluding gasoline prices and foreign exchange fluctuations. E-commerce sales continued to show strong performance, rising 11.5% for June, or 11.2% when adjusted for foreign exchange impacts. Analysts from JPMorgan maintained an Overweight rating on Costco, citing better-than-expected sales performance, while Evercore ISI reiterated an Outperform rating despite observing a slowdown in sales growth. DA Davidson held a Neutral rating, noting that traffic growth has declined to low-single digits but highlighting accelerating ticket growth. Costco’s international segments performed well, with Canada posting 6.7% growth and other international markets achieving a 10.9% increase. U.S. comparable sales rose 4.7%, with a 5.5% gain when adjusted for gasoline and currency impacts. These developments underscore Costco’s continued strong consumer demand and successful omnichannel strategy.
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