Costco Wholesale (NASDAQ: COST) is not only one of America’s favorite retailers. It’s also been a top retail stock to own over its history.
Over the last decade, it’s up 570%, easily outpacing the S&P 500‘s increase of 240%, and most investors would argue that Costco is lower-risk than the broad-based index. After all, the retailer is a classic defensive stock. As a consumer staples company, it sells primarily products that people need, like groceries, paper products, and health and beauty products. It’s also known for its buy-in-bulk bargain prices, which attract consumers in both good times and bad.
Costco has actually underperformed the market this year as it’s up just 4% through Sept. 19, pulling back from its recent peak. Is this a buying opportunity for the retail giant? Let’s take a look at the arguments to buy, sell, or hold Costco.