3 Reasons Growth Investors Will Love Costco (COST)

Core Viewpoint - Investors are increasingly seeking growth stocks that demonstrate above-average growth potential, with Costco identified as a strong candidate due to its favorable growth metrics and Zacks Rank [1][2]. Group 1: Earnings Growth - Costco has a historical EPS growth rate of 16.2%, with projected EPS growth of 11.8% for the current year, surpassing the industry average of 11.1% [4]. - Earnings growth is a critical factor for growth investors, as double-digit growth is often seen as indicative of strong future prospects [3]. Group 2: Asset Utilization - Costco's asset utilization ratio (sales-to-total-assets ratio) stands at 3.73, indicating that the company generates $3.73 in sales for every dollar in assets, significantly higher than the industry average of 1.46 [5]. Group 3: Sales Growth - The company's sales are projected to grow by 7.2% this year, compared to the industry average of 3.7%, highlighting Costco's strong sales growth potential [6]. Group 4: Earnings Estimate Revisions - The current-year earnings estimates for Costco have been revised upward, with the Zacks Consensus Estimate increasing by 0.2% over the past month, indicating positive momentum [8][9]. Group 5: Overall Assessment - Costco has achieved a Zacks Rank of 2 (Buy) and a Growth Score of A, positioning it as a potential outperformer and a solid choice for growth investors [9][10].