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Stock to Short: Costco (COST)


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#1 risktaker

risktaker

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Posted 06 May 2020 - 11:53 PM

With a PE ratio of 36.24, Costco (COST) is very expensive compared to almost every stock in this market.

It benefited in the pandemic with people stocking up, but after a couple weeks, sales has gone down in April. With social distancing in place, Costco-size parties are not going to happen in the near-term. Restaurant are buying way less than before, catering is not happening, companies are also needing less from them.

People who bought appliances online from them will have already bought. With furniture and other stores opening again, they will have much more competition.

Technically, the stock is doing really well. Nevertheless, fundamentals is going to be bad for the near-term.

Disclosure: I bought a short position on Costco.