Stifel Resumes Costco Wholesale (COST) at Buy

Stifel resumes coverage on Costco Wholesale (NASDAQ: COST) with a Buy rating and a price target of $185.00.

Analyst Mark Astrachan commented, "We are resuming coverage of Costco Wholesale Corp. with a Buy rating and a $185 target price, 14x F2018E EBITDA, supported by our sum-of-the-parts analysis. We estimate modest multiple expansion driven by accelerating sales and operating profit growth in F2017 and F2018 driven by improving comp growth. Anticipated comp improvement reflects favorable y/y comparisons, macro trends, benefits from the mid-2016 change to the Citi Visa credit card, an anticipated late F1H17 announcement of a membership fee increase, and rising gas prices. Current valuation is reasonable, in our view, with the premium to peers justified by Costco’s annuity-like membership fee and historical renewal rates."

For an analyst ratings summary and ratings history on Costco Wholesale click here. For more ratings news on Costco Wholesale click here.

Shares of Costco Wholesale closed at $164.27 yesterday.

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