Costco Wholesale Corporation (NASDAQ:COST) Yearly Results Just Came Out: Here's What Analysts Are Forecasting For This Year
As you might know, Costco Wholesale Corporation (NASDAQ:COST) recently reported its full-year numbers. Costco Wholesale reported US$167b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$9.02 beat expectations, being 4.3% higher than what the analysts expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
View our latest analysis for Costco Wholesale
Following the latest results, Costco Wholesale's 26 analysts are now forecasting revenues of US$177.5b in 2021. This would be an okay 6.4% improvement in sales compared to the last 12 months. Per-share earnings are expected to accumulate 6.1% to US$9.60. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$176.2b and earnings per share (EPS) of US$9.46 in 2021. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
There were no changes to revenue or earnings estimates or the price target of US$361, suggesting that the company has met expectations in its recent result. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Costco Wholesale at US$412 per share, while the most bearish prices it at US$235. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Costco Wholesale shareholders.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. Next year brings more of the same, according to the analysts, with revenue forecast to grow 6.4%, in line with its 7.8% annual growth over the past five years. Compare this with the wider industry, which analyst estimates (in aggregate) suggest will see revenues grow 3.2% next year. So although Costco Wholesale is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Costco Wholesale analysts - going out to 2025, and you can see them free on our platform here.
However, before you get too enthused, we've discovered 1 warning sign for Costco Wholesale that you should be aware of.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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