Bong buys COST 145.86: So just what does the retailer expect to get out of all this new spending?

That's a huge chunk of change for Costco, given that annual net income is running at less than $4 billion. Source: Costco financial filings. The warehouse retailer's capital expenditures, or capex, surged 20% higher, year-over-year. The target price indicates an upside. The mean 12-month forward target price for the stock stands at $156 after the revisions that followed the earnings release.


Kelli:
After 2016, the firm forecasts that new store openings will be split in a 50/50 ratio between the US and international segment.

Kemberly:
The firm expects the retailer to open 32 new stores in FY16, with 18-20 of the new stores being in the US with the rest being in the international market, including the first store in France.

Sharron:
The store traffic benefit from the roll-out of new gas stations in the US at existing stores could slowdown in FY16 while international gas station rollouts might partially offset the impact.

Araceli:
The EPS was pushed up by better-than-expected gross margins and a lower tax rate.

Tonita:
The EPS figure reported by Costco for its fourth quarter fiscal year 2015 (4QFY15) was higher than the consensus estimate, as well as the estimate provided by the firm.

Catarina:
At 12 PM EDT, the stock traded at a price of $143.43; this is 0.79% lower than what the stock closed for yesterday.

Reba:
The analyst states that the retailer is one of the few that have had positive traffic and market share gains in recent times.

Roni:
The analyst believes that the multiple is justified given the strength in the long-term thesis of the retailer.

Martha:
The target price of $160 given by the analyst is based on a multiple of 13.2x for the EV/EBITDA using the EBITDA estimate for FY16. The multiple falls on the high end of the five-year range for the multiple.

Antionette:
The operating margin expanded 16 bps on a year-over-year basis, driven by increased gross margin leverage.

Costco Wholesale Corp. (NASDAQ:COST)
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