Charlie Munger Identified This Stock 30 Years Ago After Warren Buffett Passed On It: Here's How It Is Doing Now

“I love everything about Costco,” the late veteran investor Charlie Munger said during the Daily Journal’s annual shareholder meeting back in February 2023.

Zoom in the future, the company has reported fiscal 2025’s first-quarter revenue and earnings per share beating analyst estimates.

What Happened: Munger, who passed away last year, had a seat on Costco Wholesale Corporation’s COST board till his death. This seat was first offered to Warren Buffett in 1997, which he declined, saying that retailing was a difficult business.

On the other hand, Munger admired Costco’s business model and recognized its unique approach to retailing, including its efficient operations, low prices, and membership model.

“I’m a total addict, and I’m never going to sell a share,” said Munger during the aforementioned shareholder meeting.

“I wish everything else in America was working as well as Costco does,” he said in early 2022. “Think what a blessing that would be for us all.”

According to Benzinga Pro data, the shares of the company have risen 4,536% since 1997.

Why It Matters: Costco’s management highlighted four new milestones achieved by the company during the first quarter.

According to the president and CEO of the company Ron Vachris, “Costco Logistics completed nearly 1 million deliveries in Q1 and over 196,000 deliveries last week alone.” He said that Costco continued to gain market share within the e-commerce space, during the analyst earnings call held on Thursday.

Secondly, Costco’s U.S. bakery division, “Reached new records of 4.2 million pies being sold the three days prior to Thanksgiving,” said Vachris.

Talking about the pharmacy business Vachris added, “Our U.S. pharmacy business has prescription growth exceeding 19% for the first quarter, setting new volume records for that business.” And lastly, on Halloween Day, Costco, in its food courts, “set a new record of 274,000 whole pizzas being sold.”

“All of these milestones reflect the continued strength of our business across the membership offering,” said Vachris.

What Are Analysts Saying: According to Benzinga, Costco has a consensus price target of $954.38 based on the ratings of 26 analysts. The highest price target out of all the analysts tracked by Benzinga is $1145 issued by Jefferies as of Dec. 5, 2024. The lowest target price is $700 issued by Barclays on March 11, 2024.

The average price target of $1073.33 between Telsey Advisory Group, Oppenheimer, and Jefferies implies a 10.10% side for Costco.