Where Will Costco Stock Be in 3 Years?
Costco Wholesale (NASDAQ: COST) has been a huge winner for investors over the long term. Since 2000, the stock has risen nearly 1,700%. Its total return for that period, which assumes reinvested dividends, comes in at 2,500%! Those massive gains are backed by a solid business that just recently announced a new catalyst for growth.
But if you buy shares today, you should prepare yourself for the possibility of a deep drawdown at some point over the next three years. Here's why.
Costco has two primary revenue streams. As a retailer, the first is fairly obvious. It sells products in its stores and online. In the fiscal third quarter of 2024, product sales tallied up to nearly $57.4 billion. The costs associated with those sales, however, are significant. Specifically, it has to buy the products it sells, generally known as the cost of goods sold (Costco calls it merchandise costs). This expense was about $51.2 billion. Subtract that from sales and you get $6.2 billion.
Source Fool.com
