Costco Gears Up for This Week's Earnings

The equity has a mixed history of post-earnings responses

Deputy Editor
Sep 20, 2022 at 12:58 PM
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Costco Wholesale Corporation (NASDAQ:COST) is set to step into the earnings confessional after the close on Thursday, Sept. 22. The mega-retailer will report fiscal fourth-quarter results, in which analysts anticipate earnings of $4.17 per share on revenue of $70.8 billion, as well as an increase of 13.7% for same-store sales.

Looking back at the last eight quarters, COST sports a mixed bag when it comes to post-earnings sessions. However, the shares moved higher in three of its last four, losing 1.4% the day after reporting back in March. This time around, the options pits are pricing in a 6% swing, regardless of direction, which is nearly triple the 2.2% move the shares have averaged over the last two years. 

Today, Costco stock was last seen 1.6% lower to trade at $498.54. The security logged three weekly losses in the last four, though the 320-day moving average is keeping this pullback in check. Year-to-date, however, COST remains down 12%.

COST Chart September 202022

Taking a closer look at the options pits, bears have been more active than usual. In fact, Costco stock's Schaeffer's put/call open interest ratio of 1.75 sits in the highest percentile of annual reading. Furthermore, at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the equity sports a 50-day put/call volume ratio of 0.95, which stands higher than 86% of reading from the past 12 months. Both of these readings indicated a healthier-than-usual appetite for bearish bets. 

 

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