Costco Wholesale Corporation Just Recorded A 8.5% EPS Beat: Here's What Analysts Are Forecasting Next

Shareholders might have noticed that Costco Wholesale Corporation (NASDAQ:COST) filed its second-quarter result this time last week. The early response was not positive, with shares down 3.2% to US$726 in the past week. The result was positive overall - although revenues of US$58b were in line with what the analysts predicted, Costco Wholesale surprised by delivering a statutory profit of US$3.92 per share, modestly greater than expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Costco Wholesale after the latest results.

See our latest analysis for Costco Wholesale

Taking into account the latest results, the current consensus from Costco Wholesale's 34 analysts is for revenues of US$254.5b in 2024. This would reflect a reasonable 2.3% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to accumulate 4.3% to US$15.98. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$254.4b and earnings per share (EPS) of US$15.74 in 2024. 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.

The analysts reconfirmed their price target of US$738, showing that the business is executing well and in line with expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Costco Wholesale analyst has a price target of US$905 per share, while the most pessimistic values it at US$480. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Costco Wholesale's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Costco Wholesale's revenue growth will slow down substantially, with revenues to the end of 2024 expected to display 4.6% growth on an annualised basis. This is compared to a historical growth rate of 12% over the past five years. Compare this to the 63 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 4.5% per year. Factoring in the forecast slowdown in growth, it looks like Costco Wholesale is forecast to grow at about the same rate as 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. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at US$738, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Costco Wholesale going out to 2026, and you can see them free on our platform here..

Plus, you should also learn about the 1 warning sign we've spotted with Costco Wholesale .

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.