Why did Buffett dump Costco stock? (2024)

Why did Buffett dump Costco stock?

It's worth noting that Buffett may have jettisoned Costco because he wanted to free up cash to buy other assets with greater upside. Indeed, Berkshire purchased nearly $18 billion worth of stocks on a net basis in the same period it sold Costco, filings show.

What caused Costco stock to drop?

Shares of membership-only discount retailer Costco (NASDAQ:COST) fell 7.7% in the afternoon session after the company reported fourth-quarter results with revenue falling short of analysts' expectations. Free cash flow also underwhelmed during the quarter with the company recording a significant amount of cash burn.

Does Warren Buffett own stock in Costco?

Berkshire Hathaway grew its holdings in the famous retailer from a split-adjusted 710,000 shares worth $32 million at the end of 1999, to 4.3 million shares valued at $1.3 billion in June 2020. Since Buffett sold the company's shares, Costco stock has soared between 88% and 127% to all-time highs.

Why is Costco a good stock to invest in?

Costco Wholesale (NASDAQ: COST) has trounced the market over almost any period you can check. It has a differentiated operating model that breeds loyalty and high sales and is resilient during challenging times.

What is Warren Buffett's number one stock?

Apple is Berkshire's largest public stock holding by far. Berkshire's $155 billion Apple stake is roughly four times larger than its second-largest holding. Buffett first bought Apple shares in the first quarter of 2016, and Apple's stock price is up more than 500% since the beginning of 2016.

Who owns the majority of Costco stock?

The largest shareholders of Costco

According to Investopedia, Craig Jelinek is the largest shareholder in the company and also holds the roles of President and CEO.

Is Costco stock expected to go up?

Stock Price Forecast

The 25 analysts with 12-month price forecasts for Costco stock have an average target of 699.72, with a low estimate of 502 and a high estimate of 870. The average target predicts a decrease of -4.77% from the current stock price of 734.80.

Why did Buffett sell Costco?

It's worth noting that Buffett may have jettisoned Costco because he wanted to free up cash to buy other assets with greater upside. Indeed, Berkshire purchased nearly $18 billion worth of stocks on a net basis in the same period it sold Costco, filings show.

Why did Warren Buffett sell his Costco stock?

Buffett loves Costco and bought in not long after long-time business partner Munger became a director in 1997. But he loves cash more, and selling shares over $350 that were originally purchased for $50 was a statement that price had got ahead of value.

How much of Costco does Buffett own?

It might come as a surprise that legendary investor Warren Buffett doesn't own Costco Wholesale (COST 0.09%) shares.

Should I keep Costco stock?

Costco could be a good long-term buy -- but at its current multiple, investors are paying for a lot of future earnings growth. If you want to hang on to it for decades, then it could still be a good investment for you.

Who are the biggest investors in Costco?

The top individual insider shareholders of Costco are Craig Jelinek, Charles Munger, and Patrick Callans, and the top institutional shareholders are Vanguard Group Inc., BlackRock Inc., and State Street Corp.

Should I sell my Costco stock?

Costco has 3.27% upside potential, based on the analysts' average price target. Is COST a Buy, Sell or Hold? Costco has a conensus rating of Moderate Buy which is based on 21 buy ratings, 8 hold ratings and 0 sell ratings.

What is Warren Buffett's favorite way to invest?

Warren Buffett's Investment Strategy

He focuses more on a company's characteristics and less on its stock price, waiting to buy only when the cost seems reasonable. The content below demonstrates this approach, and the variety of ways that you can apply these investing principles.

What is Warren Buffett's largest stock holding?

What stocks does Warren Buffett recommend?

Although old-guard favorites such as American Express (AXP) and Coca-Cola (KO) still form the core of the portfolio, Buffett & Co. have taken a shine to names such as Apple (AAPL) and Amazon.com (AMZN), and even to lesser-known firms such as Snowflake (SNOW) and Nu Holdings (NU).

How much does Costco CEO make a year?

For Craig Jelinek's final year as Costco CEO, the 71-year-old is going out with a financial bang. Jelinek's base salary for 2023 was $1.1 million, add to that stock awards of nearly $15 million and other compensation, for a total package worth a very respectable $16.8 million, per Costco's most recent proxy filings.

Who makes the most money at Costco?

Is Bill Gates a shareholder in Costco?

Bill Gates Costco Wholesale Corp

The first Costco Wholesale trade was made in Q3 2002. Since then Bill Gates bought shares ten more times and sold shares on four occasions. The investor sold all their shares in Q4 2012 and doesn't own any shares in Costco Wholesale anymore.

What will Costco stock be worth in 2030?

How much was Costco stock in 1998?

The closing price for Costco Wholesale (COST) in 1998 was $24.35, on December 31, 1998. It was up 61.8% for the year. The latest price is $734.80.

How often does Costco get new stock?

Every night. Night merch crew starts in the back aisles with paper products, pet food, cleaning/laundry supplies, water and such. Morning merch starts about 3–4 am stocking the freezers, coolers, and everything else. Clothing and household items are stocked as well.

Why is Costco so rich?

Costco's financial success has been driven by its membership model. Memberships drive customer loyalty while producing high-margin revenue. Costco's stock has been a huge winner, and its valuation is excessive.

Why is Costco so profitable?

Costco makes some of its profits from its merchandise, but the bulk of its profits come from membership dues. Only members can shop at Costco. The membership business model allows Costco to undersell the competition by offering products in bulk at lower prices to ensure customer loyalty.

Is Costco stock overvalued?

From a profit perspective, Costco stock trades at a price-to-earnings (P/E) ratio of 47. That valuation is double the average P/E ratio of the S&P 500, which currently sits at 23. It essentially means investors think Costco is worth buying at twice the price of an average stock.