Why Costco (COST) is a Top Momentum Stock for the Long-Term

Group 1: Zacks Premium Overview - Zacks Premium offers various tools for investors to enhance their stock market engagement and confidence, including daily updates on Zacks Rank and Industry Rank, access to the Zacks 1 Rank List, Equity Research reports, and Premium stock screens [1] Group 2: Zacks Style Scores - Zacks Style Scores are indicators designed to help investors select stocks with the highest potential to outperform the market within 30 days, rated from A to F based on value, growth, and momentum characteristics [2] - The Value Score identifies attractive and discounted stocks using ratios like P/E, PEG, Price/Sales, and Price/Cash Flow [2] - The Growth Score focuses on a company's future prospects by analyzing projected and historical earnings, sales, and cash flow [3] - The Momentum Score helps investors capitalize on price trends by assessing one-week price changes and monthly earnings estimate changes [3] - The VGM Score combines all three Style Scores, providing a comprehensive indicator for investors [4] Group 3: Zacks Rank and Style Scores Integration - The Zacks Rank is a proprietary model that leverages earnings estimate revisions to assist investors in building successful portfolios, with 1 (Strong Buy) stocks yielding an average annual return of +25.41% since 1988, significantly outperforming the S&P 500 [5] - To optimize returns, investors should focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B, while also considering the direction of earnings estimate revisions [6][7] Group 4: Company Spotlight - Costco - Costco Wholesale Corporation operates membership warehouses selling a wide range of products at discounted prices and is one of the largest warehouse club operators in the U.S. [8] - Costco holds a Zacks Rank of 3 (Hold) with a VGM Score of B, and a Momentum Style Score of B, having seen a 2.9% increase in shares over the past four weeks [8] - For fiscal 2024, two analysts have revised their earnings estimates upwards, with the Zacks Consensus Estimate now at $16.27 per share, and Costco has an average earnings surprise of 2.3% [8] - With a solid Zacks Rank and strong Momentum and VGM Style Scores, Costco is recommended for investors' consideration [9]