NEW YORK (TheStreet) -- Costco Wholesale Corp
(COST) was upgraded to "buy" from "neutral" at Northcoast Research this morning, with a $135 price target.
The firm cited increase square footage, buybacks, and normalized earnings per share growth.
Shares of Costco were down -0.14% to $121.39 as of 10:19 a.m. today.
Must Read: 50 Stocks Hedge Funds Love
- The revenue growth came in higher than the industry average of 4.6%. Since the same quarter one year prior, revenues slightly increased by 7.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Food & Staples Retailing industry average. The net income increased by 3.0% when compared to the same quarter one year prior, going from $459.00 million to $473.00 million.
- Net operating cash flow has increased to $1,490.00 million or 10.45% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -13.14%.
- The current debt-to-equity ratio, 0.42, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that COST's debt-to-equity ratio is low, the quick ratio, which is currently 0.57, displays a potential problem in covering short-term cash needs.
- COSTCO WHOLESALE CORP's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, COSTCO WHOLESALE CORP increased its bottom line by earning $4.63 versus $3.90 in the prior year. For the next year, the market is expecting a contraction of 0.8% in earnings ($4.60 versus $4.63).
- You can view the full analysis from the report here: COST Ratings Report
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts