Stokes Family Office Boosts Stake in Costco Wholesale by 5.4%

The Stokes Family Office LLC has increased its investment in Costco Wholesale Corporation, raising its holdings by 5.4% during the second quarter of 2023. According to a recent filing with the Securities and Exchange Commission (SEC), the institutional investor now owns 2,354 shares of Costco stock, valued at approximately $2,331,000 following the acquisition of an additional 121 shares during the quarter.

Several other institutional investors have also adjusted their positions in Costco. Notably, Brighton Jones LLC increased its stake by 12.3% during the fourth quarter, now holding 19,825 shares valued at $18,165,000. Similarly, Revolve Wealth Partners LLC raised its holdings by 13.1%, acquiring 1,123 shares worth $1,029,000. Additionally, Leavell Investment Management Inc. and Phillips Financial Management LLC made minor increases in their respective stakes, reflecting a trend of growing institutional interest in the retailer.

As of now, institutional investors collectively own 68.48% of Costco’s stock, indicating a strong confidence in the company’s market position.

Insider Trading Activity

In related news, insider trading activity at Costco has also caught attention. On September 29, 2023, Russell D. Miller, Executive Vice President, sold 3,381 shares at an average price of $915.00, amounting to a total of $3,093,615. Following this transaction, Miller’s stake in the company decreased by 25.77%, leaving him with 9,740 shares valued at approximately $8,912,100.

In another instance, Tiffany Marie Barbre, another insider, sold 1,239 shares on October 24, 2023, at an average price of $934.62, totaling $1,157,994.18. After this sale, Barbre retained 5,155 shares, worth around $4,817,966.10, representing a 19.38% reduction in her holdings. Over the past ninety days, insiders have sold a total of 7,920 shares of Costco stock, valued at $7,373,175, while insiders maintain a 0.18% ownership of the company.

Costco’s Financial Performance

Costco reported its latest earnings results on September 25, 2023, revealing $5.87 earnings per share (EPS) for the quarter, which surpassed the consensus estimate of $5.81 by $0.06. The company achieved a return on equity of 30.09% with a net margin of 2.94%. Revenue for the quarter was $86.16 billion, exceeding analysts’ expectations of $86.01 billion. This performance marks an 8.1% increase in revenue year-over-year, compared to $5.15 EPS reported in the same quarter of the previous year.

Looking ahead, analysts project that Costco will achieve an EPS of 18.03 for the current fiscal year.

Dividend Announcement and Analyst Ratings

In a strategic move, Costco has announced a quarterly dividend of $1.30 per share, payable on November 14, 2023, to investors of record as of October 31, 2023. This translates to an annualized dividend of $5.20 and a dividend yield of 0.6%, with a current dividend payout ratio of 28.56%.

Brokerages have weighed in on Costco’s stock, with Wolfe Research initiating coverage and assigning a “peer perform” rating. Morgan Stanley has adjusted its target price from $1,225.00 to $1,130.00 while maintaining an “overweight” rating. Similarly, DA Davidson reissued a “neutral” rating with a price target of $1,000.00. JPMorgan Chase & Co. lowered its target price to $1,025.00, while Mizuho reduced its target to $950.00.

Overall, 19 analysts currently rate Costco as a Buy and 11 as Hold, with an average target price of $1,063.88, according to MarketBeat.com.

Costco Wholesale Corporation operates membership warehouses across several countries, including the United States, Canada, and several European and Asian nations. The company continues to offer a diverse range of products, both branded and private label, contributing to its robust market presence.