Costco is probably one of my favorite places to shop and I think the stock price over the last 14 years has proven that to be the case for a lot of people.
The main issue I have with buying this stock is valuation and growth of the company. I don't see how they will be able to grow fast enough to support a 35+ PE ratio.
Taking the fib from the 08 lows to the 2022 highs, we get targets around 395, 327, and 258 for the 38.2, 50.0, and 61.8 retracement levels. If you think about it, 258 from a valuation perspective only starts to make the stock a reasonable price at about a PE of 20 assuming 13.23 EPS.
It looks beautiful from a long term trend perspective and I think it has many more years to grow, but I wouldn't touch it unless it was 308 or less purely from a fundamental perspective. Might look to short this one this year.
This is not financial advice. Good Luck!
The main issue I have with buying this stock is valuation and growth of the company. I don't see how they will be able to grow fast enough to support a 35+ PE ratio.
Taking the fib from the 08 lows to the 2022 highs, we get targets around 395, 327, and 258 for the 38.2, 50.0, and 61.8 retracement levels. If you think about it, 258 from a valuation perspective only starts to make the stock a reasonable price at about a PE of 20 assuming 13.23 EPS.
It looks beautiful from a long term trend perspective and I think it has many more years to grow, but I wouldn't touch it unless it was 308 or less purely from a fundamental perspective. Might look to short this one this year.
This is not financial advice. Good Luck!