Costco: Buy It Again Before Everyone Else Catches On
View original at finance.yahoo.comCostco: Buy It Again Before Everyone Else Catches On This article first appeared on GuruFocus. Costco (COST) is one of my favorite stocks to generally own, sometimes trade…
What we drew from this source
The claims Via News extracted from this document. We point to the source; we don't replace it.
The trip to $500 billion market cap could play out over 12 to 24 months
80% confidenceMembership fee increases of around 10% occur every six or seven years
80% confidenceFed's dot plot suggests three more rate cuts of 25 bps through end of next year
80% confidenceAuthor assumes Costco's retail business at 2% operating margin is worth nothing to shareholders in valuation model
80% confidenceThe best opportunity to buy Costco and earn strong double-digit returns is well behind us now
80% confidenceCostco's membership fees have historically grown at a pace surpassing 5% in most recent fiscal year
80% confidenceCostco remains misunderstood by too many potential investors despite efficient market premise
80% confidenceCostco stock could prove countercyclical if market hits a pothole
80% confidenceCostco has potential to operate 520 stores in UK, Germany, Australia and Japan versus current 80
80% confidenceMembership revenues carry very little direct costs and flow almost cleanly to pretax income
80% confidenceBest-case scenario suggests opportunity for membership increase of 50% in four developed countries alone
80% confidenceCostco has upside potential of 22% to $500 billion market cap, or even more in best-case scenario
80% confidenceA 10-bp reduction in risk-free rate would add roughly 10% to upside opportunity
80% confidenceCostco has a membership renewal rate of more than 92%
80% confidence