Costco Stock (COST) Forms Bullish ‘Golden Cross’ a Day After Posting Strong Earnings

Costco Wholesale’s (COST) stock has formed a bullish “golden cross” chart pattern a day after the retailer posted strong quarterly financial results.

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It’s the first time the stock has formed this type of positive chart pattern in three years. A golden cross is a bullish pattern that occurs when a stock’s short-term 50-day moving average crosses above its long-term 200-day moving average.

Many technical analysts and chart experts see a golden cross as marking the point where a short-term rally becomes a long-term uptrend in a stock. In Costco’s case, the golden cross comes after its share price has risen 17% to start the year.

Costco’s Strong Print

COST stock has benefited this year from a flight to safety among investors and a rotation of capital into blue-chip stocks that are viewed as safe havens in times of market volatility. Costco’s stock is also getting a boost after the warehouse club posted strong quarterly financial results.

In addition to top- and bottom-line beats, Costco also reported that its comparable-store sales have been steadily improving and rose 7.9% in February, 7.1% in January, and 7% last December. The company also continues to expand its e-commerce business, with its digital sales growing 22.6% year-over-year in the latest quarter.

Is COST Stock a Buy?

Costco’s stock has a consensus Moderate Buy rating among 23 Wall Street analysts. That rating is based on 18 Buy, four Hold, and one Sell recommendations issued in the last three months. The average COST price target of $1,086.81 implies 8.76% upside from current levels.

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