Costco (COST) Offering Possible 53.85% Return Over the Next 23 Calendar Days

Costco's most recent trend suggests a bearish bias. One trading opportunity on Costco is a Bear Call Spread using a strike $370.00 short call and a strike $380.00 long call offers a potential 53.85% return on risk over the next 23 calendar days. Maximum profit would be generated if the Bear Call Spread were to expire worthless, which would occur if the stock were below $370.00 by expiration. The full premium credit of $3.50 would be kept by the premium seller. The risk of $6.50 would be incurred if the stock rose above the $380.00 long call strike price.

The 5-day moving average is moving down which suggests that the short-term momentum for Costco is bearish and the probability of a decline in share price is higher if the stock starts trending.

The 20-day moving average is moving down which suggests that the medium-term momentum for Costco is bearish.

The RSI indicator is below 20 which suggests that the stock is in oversold territory.

To learn how to execute such a strategy while accounting for risk and reward in the context of smart portfolio management, and see how to trade live with a successful professional trader, view more here

LATEST NEWS for Costco

Bottlenecks Rattle World Economy Backbone of Container Shipping
Tue, 22 Dec 2020 00:00:00 +0000
(Bloomberg) — Supply Lines is a daily newsletter that tracks Covid-19’s impact on trade. Sign up here, and subscribe to our Covid-19 podcast for the latest news and analysis on the pandemic.Container shipping, the backbone of the global trading system, is showing signs of fatigue as the pandemic descends into its darkest days.Carriers reaping the biggest profits in at least a decade are struggling to operate reliably as bottlenecks worsen around ports from southern England to Shanghai, contorting supply chains for everything from car parts to cosmetics and medical equipment.Just 50.1% of container vessels arrived on time in November, down from 80% a year earlier and the lowest level in records dating back to 2011, according to a service reliability index compiled by Copenhagen-based Sea-Intelligence. From Asia to North America, on-time arrivals dropped below 30%, less than half the long-run average globally.Delays can add costs, induce operational headaches and restrain revenue for the shippers of cargo — companies like Costco Wholesale Corp. The Issaquah, Washington-based chain of 803 warehouse-size stores on four continents expects the situation involving container shortages and late deliveries to persist for a few more months.“There are instances of 50% or 100% or even more sales increases of an item, and if we could procure more we’d have even higher sales,” Richard Galanti, Costco’s chief financial officer, said on a conference call earlier this month. “We’re managing through it, and expect relief not until March or so of 2021.”Slowly clogging up since September, the main artery for trade between China and the U.S. is still choked. Anchored off the coast of California over the weekend were almost 20 container ships waiting to offload at Los Angeles and Long Beach, up from about a dozen at the end of November. The Port of L.A. expects to handle 152,000 inbound containers this week — a 94% increase from the same week a year ago.Read More: Bloomberg’s Coverage of the Crisis of Stranded SeafarersWeston LaBar, the CEO of the Harbor Trucking Association in Long Beach, last month expected container volume through the L.A. ports would stabilize by mid-February, when Chinese factories typically shut down for Lunar New Year. “Now we’re hearing already about a lot of bookings through June and July,” he said.Alan Murphy, CEO of analysis and data provider Sea-Intelligence, cautions that the current imbalances in containers are concentrated in North America and says the strength of demand probably won’t be sustained if Covid-19 vaccines enable U.S. consumers to quickly shift spending back to services like travel and hospitality.The shipping disruptions should calm down in the first half of 2021, Murphy says, but don’t expect the container liners to make their overcapacity mistakes of the past, which included under-bidding in freight rate contracts to below break-even levels.“The game has changed fundamentally — not because of coronavirus but because of how the carriers responded,” he said, referring to a sharp reduction in sailings in the pandemic’s early months. “They are now capable of tailoring their supply to the available demand at a tactical level that they’ve never been able to do before.”That’s what worries freight forwarders and other shippers, and the concerns extend beyond the troubles in the Pacific. The European Shippers’ Council, a Brussels-based group representing cargo owners, is crying foul about “degraded services” and surcharges, and wants the European Commission to look into the market dynamics.The main sticking point: Spot rates to transport goods, which typically fade in the final weeks of the year, are still soaring despite the service disruptions. The rate to ship a container of goods from China to Europe jumped 17% last week, tripling from a year ago to more than $4,400, according to Hong Kong-based Freightos, an online shipping marketplace.“Of course we want the shipping lines to be healthy,” said Jordi Espin, the council’s policy manager for maritime transport. “However, to make these kinds of profits when we’re in pandemic rescue mode, we don’t think it’s fair.”Shippers and container liners are always sparring over prices and reliability. But the pandemic has spotlighted the upper hand the liners now have after a decade of consolidating and forming alliances among themselves, said Olaf Merk, head of ports and shipping at the Paris-based Organization for Economic Cooperation and Development’s International Transport Forum.“That is something that the competition authorities will have to look at, I think, and some are also doing it now,” Merk said, referring to the U.S. Federal Maritime Commission’s investigation into the carriers’ role in American port congestion. “The situation in which we are now gives a lot of possibilities to the carriers to coordinate capacity and that of course increases the risks for shippers.”‘Stress Test’The world’s top container line, Copenhagen-based A.P. Moller-Maersk A/S, this month called the challenges “the most dramatic stress test of the past 75 years.” Other industry representatives say there are multiple reasons on land why the system is straining, like trucker shortages, surging e-commerce purchases or Brexit stockpiling.Stuffed with 20%-30% more cargo than it’s used to handling, the pipeline is bound to face some snarls.“Even with this Covid cargo crunch that we’re now in the middle of, things continue to move,” said John Butler, president of the World Shipping Council in Washington, which counts the big liner companies among its members. “When you so significantly overload the system, it doesn’t immediately snap back.”Butler dismissed the notion that the industry lacks competitiveness, calling it “cutthroat frankly.”Meanwhile, shares of Maersk are flirting with an all-time high and the industry more broadly banked profits of $5.1 billion in the third quarter, a four-fold increase from a year earlier. With a solid fourth quarter, the cumulative red ink of the past five years will become net profitability, according to figures compiled by John McCown, a container-industry veteran and founder of Blue Alpha Capital.He said the pandemic gave the container carriers a lesson about how to hold firm on capacity as they shift into a longer-term period of slower demand growth.“It’s been a major learning experience about having more control over their destiny,” McCown said. “But it’s not been without its struggles.”Among the turmoil of 2020: overworked mariners and cyberattacks. But one of the more remarkable events happened on Nov. 30, when the Japanese-flagged ONE Apus hit rough seas sailing from China to the U.S., sending more than 1,800 containers overboard.The ship and crew returned safely to Kobe, Japan, but the incident probably doused some shipper’s hopes of ending a turbulent year with a bang: 54 containers that plunged into the water were filled with fireworks.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

Better Buy: Costco vs. Unilever
Mon, 21 Dec 2020 15:05:07 +0000
Costco (NASDAQ: COST) and Unilever (NYSE: UL) were both well-insulated from the COVID-19 pandemic this year. Shoppers stocked up on more essentials at big retailers like Costco, and that trend boosted demand for Unilever's consumer brands. Costco's stock has risen about 25% this year, driven by its accelerating sales growth, as Unilever's stock has risen just 3%.

4 Discount Retailers Set to Maintain Winning Streak in 2021
Mon, 21 Dec 2020 14:30:02 +0000
Target (TGT), Dollar General (DG), Costco (COST) and Dollar Tree (DLTR) are well set to harness the opportunities in 2021, thanks to better pricing, effective inventory management, and merchandise and operational initiatives.

These major retailers are spending millions of dollars to show employees appreciation
Wed, 16 Dec 2020 19:47:24 +0000
Retailers open up their wallets to pay more workers after months of hard work during the COVID-19 outbreak.

Costco (COST) Poised to Tap Rising Demand Amid COVID-19
Wed, 16 Dec 2020 14:41:02 +0000
Costco (COST) has been rapidly adopting the omni-channel mantra to provide a seamless shopping experience, whether online or at stores. E-commerce comparable sales soar 71.3% during the month of November.

Related Posts


MarketTamer is not an investment advisor and is not registered with the U.S. Securities and Exchange Commission or the Financial Industry Regulatory Authority. Further, owners, employees, agents or representatives of MarketTamer are not acting as investment advisors and might not be registered with the U.S. Securities and Exchange Commission or the Financial Industry Regulatory.

This company makes no representations or warranties concerning the products, practices or procedures of any company or entity mentioned or recommended in this email, and makes no representations or warranties concerning said company or entity’s compliance with applicable laws and regulations, including, but not limited to, regulations promulgated by the SEC or the CFTC. The sender of this email may receive a portion of the proceeds from the sale of any products or services offered by a company or entity mentioned or recommended in this email. The recipient of this email assumes responsibility for conducting its own due diligence on the aforementioned company or entity and assumes full responsibility, and releases the sender from liability, for any purchase or order made from any company or entity mentioned or recommended in this email.

The content on any of MarketTamer websites, products or communication is for educational purposes only. Nothing in its products, services, or communications shall be construed as a solicitation and/or recommendation to buy or sell a security. Trading stocks, options and other securities involves risk. The risk of loss in trading securities can be substantial. The risk involved with trading stocks, options and other securities is not suitable for all investors. Prior to buying or selling an option, an investor must evaluate his/her own personal financial situation and consider all relevant risk factors. See: Characteristics and Risks of Standardized Options. The educational training program and software services are provided to improve financial understanding.

The information presented in this site is not intended to be used as the sole basis of any investment decisions, nor should it be construed as advice designed to meet the investment needs of any particular investor. Nothing in our research constitutes legal, accounting or tax advice or individually tailored investment advice. Our research is prepared for general circulation and has been prepared without regard to the individual financial circumstances and objectives of persons who receive or obtain access to it. Our research is based on sources that we believe to be reliable. However, we do not make any representation or warranty, expressed or implied, as to the accuracy of our research, the completeness, or correctness or make any guarantee or other promise as to any results that may be obtained from using our research. To the maximum extent permitted by law, neither we, any of our affiliates, nor any other person, shall have any liability whatsoever to any person for any loss or expense, whether direct, indirect, consequential, incidental or otherwise, arising from or relating in any way to any use of or reliance on our research or the information contained therein. Some discussions contain forward looking statements which are based on current expectations and differences can be expected. All of our research, including the estimates, opinions and information contained therein, reflects our judgment as of the publication or other dissemination date of the research and is subject to change without notice. Further, we expressly disclaim any responsibility to update such research. Investing involves substantial risk. Past performance is not a guarantee of future results, and a loss of original capital may occur. No one receiving or accessing our research should make any investment decision without first consulting his or her own personal financial advisor and conducting his or her own research and due diligence, including carefully reviewing any applicable prospectuses, press releases, reports and other public filings of the issuer of any securities being considered. None of the information presented should be construed as an offer to sell or buy any particular security. As always, use your best judgment when investing.