Costco shares got downgraded by analysts at Oppenheimer, on valuation concerns.
Analysts at Oppenheimer lowered their rating on the retail company’s stock to perform from outperform. Analyst Rupesh Parikh mentioned the company's price to future earnings ratio at 34.5 times is "well above prior peaks on both metrics". Parikh sees limited upside to the shares - due to premium valuation, potentially aggressive Street forecasts, and difficult compares especially in Q2 (as indicated by the analyst).
Oppenheimer’s expectation for full year 2020 and 2021 earnings are $8.40 and $8.95 a share respectively, which are below the corresponding consensus estimates of $8.55 and $9.21 per share.
However, Oppenheimer increased their price target on Costco's shares to $300 from $295.