What Analysts Recommend for Costco, Walmart, and Target



Analysts recommend a “buy” for Costco

Most analysts maintain a positive view on Costco (COST) stock. The company is expected to continue to generate an industry-leading sales growth rate despite increased competition. Value pricing, increased membership fees, healthy membership renewal rates, and square footage expansion are anticipated to drive its top line higher in coming quarters.

Strong sales led Costco to report double-digit growth in its bottom line in the past two quarters and analysts project the trend to continue in fiscal 2018 despite margin pressure stemming from price investments and competition.

Of the 29 analysts covering Costco stock, 66.0% suggest a “buy,” and 34.0% recommend a “hold.” Moreover, analysts suggest a target price of $209.28 per share, which represents an upside of 14.2% to its closing price of $183.19 on February 7, 2018.

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Analysts recommend a “hold” for WMT and TGT

As the graph above shows, the majority of analysts maintain a “hold” rating on Walmart (WMT) and Target (TGT) stock. Both these companies are projected to report improved sales growth in coming quarters thanks to their increased investments in their digital business, value pricing, and focus on merchandising. However, increased investments in growth initiatives and heightened competition owing to Amazon’s (AMZN) expansion in the grocery space are likely to hurt their margins and keep analysts on the sidelines.

About 52.0% of analysts suggest a “hold” for Walmart stock, while 48.0% maintain a “buy” rating. Analysts’ price target of $106.63 on WMT stock represents an upside of 3.7% to its closing price of $102.85 on February 7.

70.0% of analysts maintain a “hold” rating on Target stock, 19.0% of them recommend a “buy,” and 11.0% have a “sell” recommendation. Target stock closed at $73.25 on February 7, 2018, which is roughly on par with analysts’ price target.


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