Costco has been a publicly traded company since the 1980s, when it was listed on the Nasdaq. The buy-in-bulk nature of Costco made it a perfect location for customer stockpiling during coronavirus outbreaks. Our guide will show you how to open a brokerage account and start investing in Costco stock.
Quick Costco History
Costco Wholesale Corporation is a global corporation based in the United States that owns and runs a network of membership-only big-box department stores. Issaquah, Washington, an eastern suburb of Seattle, is home to Costco’s global headquarters. Costco warehouses have one of the most extensive and unique product categories available. Costco even increased the minimum pay for U.S. employees to $16 an hour in late February.
In 1983, the company founded its warehouse in Seattle. The corporation expects to open factories in 2022 for the first time in New Zealand, and Sweden. Costco Business Centers are warehouses that are close to traditional Costco warehouses that are available to all Costco customers. Their products are mostly for companies, with an emphasis on small businesses.
The Good and the Bad of Costco Stock
There are many potential benefits to owning stocks or shares in a company. Here are some of the pros and cons of being a Costco shareholder.
Pros of Owning Costco Stock
- Due to the wide variety and consistency of its products, Costco is a leading wholesale club. The company’s policy of selling goods at deep discounts has helped it maintain success in difficult economic times.
- Costco is one of the few stocks with a track record of stable growth and improved success over many economic cycles. It is unlikely to make you wealthy, but it will not leave you penniless.
Cons of Owning Costco Stock
- Consumers have a variety of discount retailers and wholesale clubs to choose from. Target and Wal-Mart are in competition with Costco because they both offer very low prices and affordable deals.
- Costco has a highly lucrative business model, but it was slow to embrace e-commerce. Members of Costco are very committed to this popular store, but shoppers are increasingly turning to online retailers.
Outlook for Costco Stock
Investors were not pleased with Costco Wholesale’s (NASDAQ:COST) fiscal second-quarter earnings, which were released in early March. The stock has stabilized and is now trading at a higher volume than before the earnings announcement. Under the pressure of the increased e-commerce demand, most stores are struggling to remain afloat.
Despite this, Costco’s growth continues to be solid, thanks to its existing business strategy and loyal customers. Costco’s earnings, released on March 4, showed a 15% increase in revenue year over year. The total number of Costco cardholders increased to 105 million in 2020, up from 98.5 million in 2019. On a year-over-year basis, Costco increased by 24.2 percent, according to figures released on May 8.
Steps to Buy Costco Stock
To purchase Costco stock, you must first open a brokerage account, then a trading account, deposit money, and then begin purchasing shares.
Step 1: Select Your Preferred Brokerage
You must first choose a brokerage before you can buy Costco stock. A good brokerage will make your experience in the stock markets more enjoyable.
Step 2: Open the Trading Account
After you’ve decided on the best brokerage for you, you’ll need to open an account with them. This account is only available through the internet, and it helps you to keep track of your portfolio’s stocks.
Step 3: Deposit Funds Into the Account
After you’ve linked a payment option to your account, you’ll be able to deposit funds to purchase Costco stock. The next move is to figure out how many Costco stock shares you’d like to buy.
Step 4: Search for the Costco Ticker Symbol (COST)
A ticker symbol is used to label a publicly traded stock on the exchange. Costco is publicly traded on the Nasdaq under the ticker symbol “COST.”
Step 5: Purchase Costco Stock
After that, you must pick between market and limit orders to buy Costco stock. A market order will buy the stock at the current price, while a limit order will only buy the stock if the price you specify is met.
Is Costco Stock a Good Buy?
As one of the best names in the retail market, Costco has provided investors with both consistency and growth prospects for years. Costco’s stock has been growing in recent weeks, but it has been in decline since March. The company has been able to outperform Walmart in stretches and competes with big e-commerce stores such as Amazon.
This discounter has shown that it is capable of staying in business for the long term. In recent weeks, the stock has lagged, indicating weakness. This is a stock that investors should be keeping an eye on. Investors will definitely start to add shares of this stock to their portfolio once it starts to improve. If you have any doubts over whether to buy Costco stock, reach out to a trusted financial advisor today.