Piper Jaffray Remains Bullish on Costco Wholesale (COST) Ahead of June Comp Release

Piper Jaffray reiterated an Overweight rating and $171.00 price target on Costco Wholesale (NASDAQ: COST) ahead of the company's June comp release. Piper Jaffray projects core comparable sales to be (1%) to +1% which implies a 2ppt deceleration in the two-year comp trend and expects any weakness to be short-lived.

Analyst Sean Naughton commented, "Ahead of the June comp release slated for Wednesday evening, we continue to recommend COST shares. We're erring on the side of caution with our June comp forecast as our core comp estimate of (1%) to +1% assumes a 2ppt deceleration in the two-year comp trend from May. The card transition has not been seamless as some members did not immediately receive their card; that said, we believe any fundamental weakness will be transitory and share weakness will be viewed as an opportunity. We estimate gas/FX was a 280bp negative drag on the comp, putting reported results closer to (4%) to (2%). Looking forward, we continue to recommend shares ahead of a potential fee increase as Costco has historically outperformed the market in the twelve months leading up to these increases."

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 $156.11 yesterday.

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