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Research Alert: CFRA Keeps Buy Opinion On Shares Of Costco Wholesale Corporation
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Research Alert: CFRA Keeps Buy Opinion On Shares Of Costco Wholesale Corporation
May 30, 2025 7:35 AM

10:15 AM EDT, 05/30/2025 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We raise our 12-month target price by $30 to $1,130, about 55x our FY 26 (Aug.) EPS of $20.49 (up from $19.76; FY 25 EPS also raised to $18.44 from $18.29). This multiple represents a premium to the company's five-year average of about 40x, which we believe is warranted given industry-leading comparable sales growth, strong membership metrics, and meaningful club unit expansion in both the U.S. and international markets. We also see long-term operating margin expansion opportunities, noting Q3 FY 25 operating margins hit 4.0% (+30 bps Y/Y). We believe COST's Q3 FY 25 results underscore its resilient business model amid a challenging macro environment. Tariff risks appear manageable due to its limited SKU model and sourcing expertise, including increased local production of Kirkland Signature products. Additionally, COST has limited exposure to China, with only about 8% of total U.S. sales tied to China-imported items. We maintain our Buy rating and believe COST shares can sustain their premium valuation.

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